Gilead gains foothold in CAR-T therapies with $11.9-billion deal for Kite Pharma

Gilead Sciences entered a definitive agreement to acquire Kite Pharma for $180 per share, in an all-cash deal worth approximately $11.9 billion, the companies announced Monday. Gilead said the acquisition, through which it gains Kite Pharma's CAR-T therapy candidate axicabtagene ciloleucel, "immediately positions [us] as a leader in cell therapy." The transaction, which was unanimously approved by both boards, is expected to close in the fourth quarter. 

The companies said the purchase price represents a 29-percent premium to Kite Pharma's closing on August 25. Shares in Kite Pharma climbed as much as nearly 30 percent on the news.

John Milligan, chief executive at Gilead, remarked "this is a pivot to cellular therapy as our main strategy going forward." Last year, the CEO indicated that Gilead was on the lookout for assets to strengthen its pipeline, but he expressed caution that venturing into engineered T-cell therapies for cancer would be "very labour-intensive" and likely "quite expensive." However, Milligan now says the "field of cell therapy has advanced very quickly, to the point where the science and technology have opened a clear path toward a potential cure," adding that Gilead "[shares Kite Pharma's] belief that cell therapy will be the cornerstone of treating cancer." He further noted that Gilead will not be "going quiet after this deal," but rather will continue to look for assets.

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Axicabtagene ciloleucel, also known as KTE-C19, is under priority review in the US for transplant-ineligible patients with relapsed or refractory aggressive non-Hodgkin lymphoma (NHL), with an expected decision date of November 29 (for additional analysis, see Spotlight On: Reassessing the FDA's first CAR-T AdCom as Kite confirms there won't be a second one). Gilead said the therapy is also under expedited review in the EU, making it the first submission in Europe for a CAR-T therapy, with approval there expected next year. Analysts anticipate global revenue of $1.7 billion for axicabtagene ciloleucel by 2022.

Apart from axicabtagene ciloleucel, the deal is also expected to provide Gilead with a "broad pipeline" in haematologic malignances and solid tumours. The companies noted that Kite Pharma has additional candidates under development in both fields, including KITE-585, a CAR-T therapy candidate that targets BCMA expressed in multiple myeloma.

The takeover marks the largest acquisition by Gilead since its 2011 purchase of hepatitis C drug developer Pharmasset. Gilead recently reported that its hepatitis C assets Sovaldi (sofosbuvir), Harvoni (ledipasvir/sofosbuvir) and Epclusa (sofosbuvir/velpatasvir) generated sales of $2.9 billion in the second quarter, down from $4 billion in the year-ago period.

Meanwhile, an FDA advisory panel in July backed approval of Novartis' investigational CAR-T therapy tisagenlecleucel-T for use in certain patients with relapsed/refractory B-cell acute lymphoblastic leukaemia. Additionally, news of Gilead's deal for Kite Pharma also drove shares up as much as nearly 22 percent in Juno Therapeutics, whose investigational CAR-T therapy JCAR17 is under review by US and EU regulators for the treatment of relapsed/refractory diffuse large B-cell lymphoma.

For related analysis, see ViewPoints: Gilead makes its long-awaited splash in oncology. See also ViewPoints: With no pricing war on the horizon in CAR-T, the sky's the limit for Gilead and Novartis.


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