Gilead Takes Immunomedics for $21 Billion

16.09.2020 - Gilead Sciences is to acquire Immunomedics for approximately $21 billion. The deal, unanimously approved by both companies' boards of directors, will be funded by $15 billion in cash and $6 billion in new debt, and is expected to close during the fourth quarter of 2020.

Market observers said the acquisition is a massive step forward for Gilead’s focus on oncology, with the biopharma paying a premium to gain breast cancer treatment Trodelvy, a drug that is reported to have achieved sales of $20 million since it launched in Q2. Analysts expect Trodelvy sales to reach $2.3 billion by 2026.

A first-in-class Trop-2 directed antibody-drug conjugate (ADC), Trodelvy was granted accelerated approval by the US Food and Drug Administration in April for treating patients with metastatic triple-negative breast cancer who have received at least two prior therapies for metastatic disease. 

Immunomedics plans to submit a supplemental Biologics License Application to support full approval of Trodelvy in the US in Q4 and is also on track to file for regulatory approval in Europe in the first half of 2021.

Trodelvy is also being studied in an ongoing Phase 3 trial in third line HR+/HER2- breast cancer and a registrational Phase 2 study in bladder cancer. Additional ongoing studies are evaluating Trodelvy’s potential as a treatment for non-small cell lung cancer and other solid tumor types.

“This acquisition represents significant progress in Gilead’s work to build a strong and diverse oncology portfolio," said Gilead chairman and CEO Daniel O’Day. "Trodelvy is an approved, transformational medicine for a form of cancer that is particularly challenging to treat. We will now continue to explore its potential to treat many other types of cancer, both as a monotherapy and in combination with other treatments.”

After closing, Gilead will retain global rights to Trodelvy outside of greater China, South Korea and certain Southeast Asian countries.  

The Immunomedics purchase follows several deals that Gilead has signed this year as it strives to expand its oncology profile. It bought a 49.9% share in cancer drug developer Pionyr Immunotherapeutics in June for $275 million, just months after snapping up immuno-oncology company Forty Seven for $4.9 billion.

Analysts expressed skepticism about whether the buy was a wise one, as it essentially depletes Gilead’s cash at hand. At the current consensus peak sales of less than $4 billion for Trodelvy, SVB’s Geoffrey Porges said the biopharmaceuticals producer would only break even on the transaction. “The purchase price requires heroic revenue assumptions to create value,” he added.


Author: Elaine Burridge, Freelance Journalist