(Reuters) – Celgene Corp announced a $9 billion cash buyout of Juno Therapeutics Inc on Monday as it moves to cement its position as a key player in a new range of cancer therapies.
The offer of $87 per share for the 90 percent of Juno that Celgene does not own sent Juno’s stock soaring 27 percent to $86.31 in premarket trading. Shares of Celgene fell 1 percent to $101.60.
The two companies said the deal, agreed by both boards, is expected to close in the first quarter of 2018.
It adds Juno’s experimental JCAR017 treatment for a type of blood cancer to Celgene’s existing lymphoma program and is the company’s second purchase so far in 2018 as changes to U.S. taxes hand drugmakers more capital to spend on promising assets.
Analysts say new treatments will help Celgene reduce its reliance on Revlimid, its top-selling cancer drug that accounts for more than 60 percent of its revenue.
“Juno’s advanced cellular immunotherapy portfolio and research capabilities strengthen Celgene’s global leadership in hematology and adds new drivers for growth beyond 2020,” Celgene Chief Executive Mark Alles said.
Earlier this month, Celgene agreed to acquire privately-held Impact Biomedicines for as much as $7 billion, depending on certain milestones.
The Summit, New Jersey-based company also has partnerships with bluebird bio Inc and Agios Pharmaceuticals Inc, both of which are developing cancer treatments.
Unlike its rivals Kite Pharma, which was bought by Gilead Sciences Inc in 2017, and Novartis AG, Juno is yet to get an approval for a CAR-T drug.
Juno’s JCAR017 is an example of chimeric antigen receptor T-cell therapies, known as CAR-T, which harnesses the body’s own immune cells to recognize and attack cancer.
It is expected to be approved in 2019 and could bring in peak sales of about $3 billion worldwide, the companies said.
In 2015, Celgene paid $93 per Juno share for 9.7 percent of the company.
Celgene said the latest acquisition is expected to add to its 2020 target net revenue incrementally, but will not affect adjusted earnings forecast of more than $13 per share.
J.P. Morgan Securities LLC is the financial adviser for Celgene and Morgan Stanley & Co for Juno.
Proskauer Rose LLP and Hogan Lovells will be the legal counsel for Celgene and Skadden, Arps, Slate, Meagher and Flom LLP for Juno.