Bristol-Myers to buy Medarex for $2.4 billion
* On Wednesday July 22, 2009, 8:32 pm EDT
By Ransdell Pierson
NEW YORK (Reuters) - U.S. drugmaker Bristol-Myers Squibb Co (NYSE:BMY - News) late on Wednesday said it will pay $2.4 billion to acquire Medarex Inc (NasdaqGM:MEDX - News), a biotechnology company that has been helping it develop a promising treatment for melanoma since 2005.
The agreed offer of $16 a share represents a 90 percent premium to Medarex's closing share price on Wednesday of $8.40 per share on Nasdaq. Bristol already owns a 2 percent stake in Medarex, through its four-year-old partnership with its neighbor in Princeton, New Jersey.
The deal could help Bristol-Myers regain its stature as one of the world's leading players in the oncology market, and to develop treatments for immunologic conditions such as arthritis, lupus and psoriasis.
Medarex has developed mice with human immune systems that are able to generate fully human antibodies that can be used as drugs.
The two companies are developing one of the antibodies, called ipilimumab, as a treatment for patients in late stages of melanoma -- the most deadly form of skin cancer for which no highly effective treatments now exist.
In three mid-stage clinical trials, 30 to 42 percent of patients with metastatic melanoma treated with the drug were still alive after two years, which Bristol-Myers said established a survival benefit.
The companies are now conducting a larger late-stage trial, requested by U.S. regulators, designed to show an unequivocal survival benefit.
"This deal will give us (full) rights to ipilimumab and broadly position Bristol-Myers for long-term leadership in biologics," said Bristol-Myers spokesman Brian Henry, referring to complicated biotech drugs that are typically given by injection.
He said Medarex is testing 10 other drugs in clinical trials, some with other large drugmakers.
"This deal clearly expands our opportunities in oncology and immunology," Henry said.
(Reporting by Ransdell Pierson; Editing by Gary Hill and Carol Bishopric)
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