Amgen in $1.9bn swoop for Five Prime and its gastric cancer drug

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Amgen is to buy US biotech Five Prime Therapeutics for around $1.9 billion, adding a potential gastric cancer drug to its pipeline.

The big pharma swooped in after the California biotech reported promising phase 2 trial results from bemarituzumab in November.

The phase 2 FIGHT trial testing bemarituzumab plus chemotherapy as a front-line therapy for advanced gastric and gastroesophageal junction cancer met all its efficacy objectives, with significant improvements in overall survival, progression-free survival and overall response rate compared to chemo alone.

At that time Five Prime announced plans for another public offering to finance a phase 3 trial but has decided that a merger with a big pharma is a better option.

The deal also works for Amgen, which is hoping to make inroads into the oncology market after filing its ground-breaking KRAS inhibitor sotorasib with the FDA in December.

Amgen is also developing tezepelumab, an injection for severe asthma, in partnership with AstraZeneca and is heading for an FDA filing later this year.

But with the ageing inflammatory disease drug Enbrel still Amgen’s biggest seller with revenues of nearly $4.9 billion last year, the company is looking for new income streams as the blockbuster’s sales decline.

As well as fitting with Amgen’s R&D plans, bemarituzumab fits with Amgen’s international expansion strategy.

Gastric cancer is one of the world’s most common forms of cancer and is particularly prevalent in the Asia-Pacific region, where Amgen expects to grow sales in the coming years.

Amgen already has a presence in Japan and other Asia-Pacific markets to realise bemarituzumab’s potential.

As part of this transaction, Amgen will also receive a royalty percentage on future net sales in Greater China ranging from the high teens to the low twenties from a pre-existing co-development and marketing agreement between Five Prime and Zai Lab.

The deal valuing Five Prime’s share at $38 is expected to close by the end on the second quarter, if it clears US antitrust regulations.