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Gilead Sciences entered into a definitive agreement to acquire Forty Seven for $95.50 per share in cash, or approximately $4.9 billion, further boosting the company's immuno-oncology presence.

Gilead Sciences announced Monday that it entered into a definitive agreement to acquire Forty Seven for $95.50 per share in cash, or approximately $4.9 billion, further boosting the company's presence in immuno-oncology. The transaction has been unanimously approved by both Gilead and Forty Seven's boards and is expected to close during the second quarter.

"This agreement builds on Gilead's presence in immuno-oncology and adds significant potential to our clinical pipeline," remarked Gilead chief executive Daniel O'Day. Through the deal, Gilead will gain Forty Seven's investigational lead product candidate magrolimab, formerly Hu5F9-G4. The monoclonal antibody, which targets CD47, is in clinical development for the treatment of several cancers, including myelodysplastic syndrome (MDS), acute myeloid leukaemia (AML) and diffuse large B-cell lymphoma (DLBCL), as well as non-Hodgkin lymphoma (NHL) and solid tumours. Gilead said the deal will also help it towards its goal of "bringing 10 transformative therapies to patients in the next 10 years." 

Last week, sources suggested that Gilead had made a takeover approach to Forty Seven, although they also noted at the time that the immuno-oncology company had received interest from other potential suitors as well. The price that Gilead agreed to pay for Forty Seven represents a premium of 64.7% to the stock's closing price on February 28. 

Gilead entered the oncology space in 2017 via the $11.9-billion purchase of Kite Pharma, through which it gained the CAR-T therapy Yescarta (axicabtagene ciloleucel). "Magrolimab complements our existing work in haematology, adding a non-cell therapy programme that complements Kite's pipeline of cell therapies for haematological cancers," O'Day said, adding "with a profile that lends itself to combination therapies, magrolimab could potentially have transformative benefits for a range of tumour types." 

In December, Forty Seven said data from 46 evaluable patients enrolled in an ongoing Phase Ib study of magrolimab plus azacitidine showed an overall response rate (ORR) of 92% for patients with higher-risk MDS, with half achieving a complete response, and an ORR of 64% for those with untreated AML, with 41% having a complete response. Gilead executives suggested magrolimab could eventually be used alongside Yescarta, with chief medical officer Merdad Parsey saying "there are studies ongoing and data being generated in DLBCL, and that's one of those areas where I think you could imagine that there could be... possibilities." 

"The deal is in line with the strategy…O'Day had laid out earlier in the year, but I think he and his management need to do something more impactful," Credit Suisse analyst Evan Seigerman said. Meanwhile, SunTrust analysts Robyn Karnauskas and Asthika Goonewardene predicted that while Yescarta has gained market share as a treatment for certain types of relapsing lymphoma, the market will in the future likely be split between treatments such as magrolimab and CAR-T therapies. Sales of Yescarta reached $122 million in the fourth quarter of last year, below analyst estimates around $132 million.

Magrolimab has been granted fast-track status by the FDA for MDS and AML, and for the treatment of relapsed or refractory DLBCL and follicular lymphoma. The therapy also has orphan drug designations from the agency for the treatment of MDS and AML, and by the European Medicines Agency for AML. Forty Seven is also developing the anti-cKIT antibody FSI-174 and the anti-SIRPα antibody FSI-189.

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Last Updated: 03-Mar-2020