Otsuka Pharmaceutical To Acquire Astex Pharmaceuticals

The Japanese pharmaceutical company Otsuka Pharmaceutical has agreed to acquire Astex Pharmaceuticals, a company specializing in small-molecule drug development with a focus on oncology, for $886 million. The deal will proceed through an all-cash tender offer by Otsuka followed by a second-step merger through Otsuka America Inc., the company's US subsidiary, according to a Sept. 5, 2013 Otsuka press release. Otsuka expects to close the transaction early in the fourth quarter of 2013, subject to the satisfaction of customary closing conditions, according to a Sept. 5, 2013 Astex Pharmaceuticals press release.

Astex Pharmaceuticals' lead commercial product is Dacogen (decitabine), used to treat myelodysplastic syndromes and elderly acute myeloid leukemia. It has eight drugs in clinical development, four in Phase I development and four in Phase II development. It also holds fragment-based drug-discovery technology that evaluates the binding of target proteins with small molecules by 3D structural analysis, an improved approach, Otsuka says, over current high-throughput screening technology for measuring pharmacological activity. The technology to combine these small fragments makes it possible to discover lead compounds more quickly, according to the company.

For purposes of the transaction, the initial tender offer period will begin within 10 business days after Sept. 5, 2013 and end 20 business days thereafter. Under certain circumstances, Otsuka will be obligated to extend the tender offer to no later than Jan. 31, 2014. Otsuka has established an acquisition vehicle, Autumn Acquisition Corporation, for purposes of the acquisition. After the tender offer has concluded, Autumn Acquisition Corporation will merge with and into Astex, and Astex will become Otsuka America’s direct wholly owned subsidiary and an indirect wholly owned subsidiary of Otsuka.

Source:

Otsuka Pharmaceutical

and

Astex Pharmaceuticals