The deal sparked fresh speculation that Kite’s competitors could get snapped up by other large buyers. That pushed up shares of Seattle biotech Juno Therapeutics by 18.7 percent Monday.
Gilead Sciences will pay $11.9 billion in cash to buy Kite Pharma and plant a stake in an emerging area of cancer treatments that train a patient’s immune cells to attack tumors.
Kite’s portfolio of potential treatments includes one for the blood cancer lymphoma that could receive U.S. regulatory approval later this year.
The Santa Monica, California-based company specializes in developing treatments that are custom-made to target a patient’s cancer. Called CAR-T, this type of therapy involves removing immune cells from a patients’ blood, reprogramming them to create an army of cells that can zero in on and destroy cancer cells, and injecting them back into the patient.
Gilead will pay $180 a share for Kite in the all-cash deal, a 29 percent premium to the company’s Friday close. The deal sparked fresh speculation that Kite’s competitors could get snapped up by other large buyers. That pushed up shares of Seattle biotech Juno Therapeutics by 18.7 percent Monday.
Gilead has developed top-selling treatments for HIV and the liver-destroying hepatitis C virus, but leaders of the biotechnology company told analysts Monday that its push into oncology has been largely nascent so far. They said that the Kite deal helps establish Gilead as a leader in so-called cellular therapy and provides an opportunity to diversify revenue.
Investors have been pushing Gilead management for a couple of years to diversify by making a big deal. The company’s once-surging revenue from hepatitis C drugs has been declining amid increased competition and pressure from insurers for lower prices.
The companies expect approval for Kite’s potential treatment of refractory aggressive Non-Hodgkin lymphoma around November in the United States and next year in Europe.