Algeta confirms Bayer acquisition bid

The Board of Directors of Algeta, the Norwegian cancer drugmaker, has confirmed that it has received a preliminary acquisition proposal from Bayer AG. The offer is said to be approximately $2.4 billion.

This bid follows the pharma industry's current pattern where large pharma companies are acquiring smaller companies or entering partnership agreements to combat the rising costs of developing new blockbuster drugs.

However, Algeta has said that "there is no certainty that this preliminary acquisition proposal will lead to a transaction or as to the terms of any such transaction".

Bayer and Algeta have been working together since 2009 on the prostate cancer drug Xofigo (radium Ra 223 dichloride injection), which was approved by the US Food and Drug Administration in May 2013. Xofigo is approved for the treatment of patients with castration-resistance prostate cancer (CRPC), symptomatic bone metastases and no known visceral metastatic disease. The drug is the first alpha particle-emitting radioactive therapeutic agent approved by the FDA.

If Bayer was successful in its bid to acquire Algeta, it would gain complete control of Xofigo.