In a deal valued at $2.1 billion, Swiss pharma giant Novartis AG will purchase Endocyte, a U.S.-based biopharmaceutical company developing new treatments for prostate cancer.
Endocyte focuses on radiogland therapies, a new class of medications that deliver radioactive substances directly to cancer cells to kill them. Novartis will pay $24 a share to acquire the company.
The deal, subject to regulatory approval, would expand Novartis' radiogland therapy pipeline with a potential near-term product launch and early stage clinical development programs. Novartis already has a radiopharmaceutical for a rare form of stomach cancer, which it acquired in a $3.9 billion deal in 2017.
"Today's announcement about the proposed acquisition of Endocyte builds on our growing capability in radiopharmaceuticals, which is expected to be an increasingly important treatment option for patients and a key growth driver for our business," said Liz Barret, CEO of Novartis Oncology. "We are also excited about the opportunity to break into the prostate cancer arena with a near-term product that has the potential to make a meaningful impact for patients in great need of more options."
The acquisition is latest move by Novartis to refocus its efforts on high value prescription drugs. In the last year, Novartis has spun off its Alcon eye-care unit to GlaxoSmithKline for $13 billion and sold parts of its Sandoz generic drug unit.