GSK To Acquire Oncology-Focused Biopharm Company Tesaro for $5.1 Billion

GlaxoSmithKline (GSK) plans to acquire Tesaro, a Waltham, Massachusetts-based oncology-focused biopharmaceutical company, for approximately $5.1 billion to accelerate the build of GSK’s pipeline and commercial capability in oncology.

Tesaro is a commercial-stage biopharmaceutical company with a marketed product, Zejula (niraparib), an oral poly ADP ribose polymerase (PARP) inhibitor approved for treating ovarian cancer. Zejula is approved in the US and Europe as a treatment for adult patients with recurrent ovarian cancer who are in response to platinum-based chemotherapy, regardless of BRCA mutation or biomarker status. Zejula’s revenues in its current approved indication as a second-line maintenance treatment for ovarian cancer were $166 million for the nine months ended September 30, 2018.

GSK believes PARP inhibitors also offer opportunities for use in treating multiple cancer types. In addition to ovarian cancer, Zejula is being studied as a possible treatment in lung, breast, and prostate cancer, both as a monotherapy and in combination with other medicines, including with Tesaro’s dostarlimab, an anti-PD-1 antibody. In addition to Zejula, Tesaro has several oncology assets in its pipeline, including antibodies directed against PD-1, TIM-3 and LAG-3 targets.

“The acquisition of Tesaro will strengthen our pharmaceuticals business by accelerating the build of our oncology pipeline and commercial footprint, along with providing access to new scientific capabilities,” Emma Walmsley, Chief Executive Officer, GSK, said in a December 3, 2018 company statement. “This combination will support our aim to deliver long-term sustainable growth and is consistent with our capital allocation priorities.”

Under the merger agreement, unanimously approved by Tesaro’s Board of Directors, an indirect subsidiary of GSK will commence a tender offer within the next 10 business days (as of December 3, 2018) to acquire all of the issued and outstanding shares of Tesaro common stock for a price of $75 per share in cash upon completion of the offer.

The transaction is expected to complete in the first quarter of 2019, subject to satisfaction of customary closing conditions, including the tender by Tesaro stockholders of at least one share more than 50% of the issued and outstanding shares of Tesaro and required regulatory approvals, including clearance by the US Federal Trade Commission.

GSK said it is in discussions with several key executives of Tesaro to ensure their continued employment with the company.

Source: GlaxoSmithKline

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