AstraZeneca to Acquire Fusion Pharmaceuticals, for Up To $2.4 Billion

astrazeneca

AstraZeneca (LSE/STO/Nasdaq: AZN) has entered into a definitive agreement to acquire Fusion Pharmaceuticals Inc., a Hamilton, Canada-based clinical-stage biopharmaceutical company developing next-generation radioconjugates (RCs).

Under the terms of the definitive agreement, AstraZeneca, through a subsidiary, will acquire all of Fusion’s outstanding shares pursuant to a plan of arrangement for a price of $21.00 per share in cash at closing plus a non-transferable contingent value right of $3.00 per share in cash payable upon the achievement of a specified regulatory milestone. The upfront cash portion of the consideration represents a transaction value of approximately $2bn, a 97% premium to Fusion’s closing market price of $10.64 on 18th March 2024 and an 85% premium to the 30-day volume-weighted average price (VWAP) of $11.37 before this announcement. Combined, the upfront and maximum potential contingent value payments represent, if achieved, a transaction value of approximately $2.4bn, a 126% premium to Fusion’s closing market price on 18th March 2024 and a 111% premium to the 30-day VWAP. As part of the transaction, AstraZeneca will acquire the cash, cash equivalents and short term investments on Fusion’s balance sheet, which totalled $234m as of 31st December 2023.

The transaction is expected to close in the second quarter of 2024, subject to customary closing conditions, including the approval of Fusion shareholders and regulatory clearances.

This acquisition complements AstraZeneca’s oncology portfolio with the addition of the Fusion pipeline of RCs, including their most advanced programme, FPI-2265, a potential new treatment for patients with metastatic castration-resistant prostate cancer (mCRPC). FPI-2265 targets prostate-specific membrane antigen (PSMA), a protein that is highly expressed in mCRPC, and is currently in a Phase II trial.

The acquisition brings new expertise and pioneering R&D, manufacturing and supply chain capabilities in actinium-based RCs to AstraZeneca. It also strengthens the company’s presence in and commitment to Canada. Fusion will become a wholly owned subsidiary of AstraZeneca, with operations continuing in Canada and the US.

Led by John Valliant, Chief Executive Officer, Fusion Pharmaceuticals is a clinical-stage oncology company focused on developing next-generation RCs. Fusion connects alpha particle emitting isotopes to various targeting molecules to selectively deliver the alpha emitting payloads to tumours. Fusion’s clinical-stage development portfolio includes lead programme, FPI-2265, targeting PSMA for mCRPC and novel RCs targeting solid tumours.

FinSMEs

25/03/2024