Takeda to buy U.S. maker of cancer drugs

ReutersJapan’s Takeda Pharmaceutical Co. said it would buy cancer drug maker Ariad Pharmaceuticals Inc. in a deal valued at $5.2 billion, to beef up its oncology pipeline.

Takeda — which in September revealed it was scouting for multibillion dollar acquisitions to reduce its dependence on domestic sales — agreed to pay $24 for each Ariad share, a premium of about 75 percent to its Friday close.

Ariad stock was up 73 percent at $23.77 in morning trading on Monday. In 2016, its shares had nearly doubled.

Takeda’s top-selling blood cancer drug Velcade is expected to face generic competition this year and other key products go off patent from 2020.

Cancer drugs are appealing to large drugmakers, with high prices being paid for promising assets. San Francisco-based Medivation was bought by Pfizer Inc. for $14 billion in August.

Given the scarcity of commercial-stage oncology assets and significant potential synergies, other Ariad bidders could emerge, SunTrust Robinson analysts said.

In November, Reuters reported that Takeda’s negotiations to acquire Valeant Pharmaceuticals International Inc.’s Salix stomach-drug business had stalled, citing sources.

With the Ariad deal, the Japanese drug giant gains access to the leukemia drug Iclusig, which is expected to generate sales of $170 million-$180 million in 2016.

Ariad came under fire in October for price increases of Iclusig.

A U.S. Food and Drug Administration decision on its lung cancer treatment, Brigatinib, which is being touted as a potential blockbuster, is expected by April.

Takeda’s last major deal was in 2011 when it paid nearly $14 billion for Swiss drugmaker Nycomed.Speech

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