AbbVie agrees to buy Stemcentrx for $5.8bn

The deal gives AbbVie rights to Stemcentrx’s experimental treatment for a form of lung cancer and other experimental drugs.

Stemcentrx’s lead late-stage asset rovalpituzumab tesirine (Rova-T) is presently in registrational trials for small cell lung cancer (SCLC).

Rova-T is derived from cancer stem cells and targets delta-like protein 3 (DLL3) that is expressed in over 80% of SCLC patient tumors.

Registrational trials for third-line small cell lung cancer are anticipated to complete enrollment by the end of this year.

AbbVie will pay about $2bn of the agreement value in cash and fund the remaining part with stock.

Stemcentrx investors are also eligible to receive up to $4bn in cash for further, success-based milestone payments for achieving various regulatory and clinical developments.

The transaction is anticipated to close in the second quarter of this year.

AbbVie chairman and CEO Richard Gonzalez said: "The addition of Stemcentrx and its late-stage compound Rova-T provide AbbVie with a unique platform in solid tumor therapeutics and complement our leadership position in hematologic oncology.

"We believe the acquisition of Stemcentrx will strengthen and accelerate our ability to deliver innovative therapies that will have a remarkable impact on patients’ lives."

Besides Rova-T, Stemcentrx has four novel compounds in clinical trials across various solid tumor indications such as triple-negative breast cancer, ovarian cancer and non-small cell lung cancer.

Stemcentrx has additional pre-clinical compounds advancing toward clinical trials in this year and a technology platform that uses stem cell biology to identify and screen potential targets against live tumor tissue.