Baxter International has signed a definitive agreement to acquire the Oncaspar (pegaspargase) product portfolio from Sigma-Tau Finanziaria. Baxter gains the marketed biologic treatment Oncaspar, the investigational biologic calaspargase pegol and an established oncology infrastructure with clinical and sales resources.
The transaction is expected to close in the third quarter. By mid-year, Baxter expects to establish the BioScience business as a separate, publicly traded, innovation-oriented biopharmaceutical company, Baxalta. Baxter announced last fall its plans to separate its biopharmaceuticals business into Baxalta, an independent company to be headquartered in Illinois.
Oncaspar is a first-line biologic used as part of a multi-agent chemotherapy regimen to treat acute lymphoblastic leukemia (ALL). It currently is marketed in the U.S., Germany, Poland and certain other countries and has approximately $100 million in annual sales. ALL is a rare, fast-growing cancer of the white blood cells, with approximately 5,000 new cases each year in the U.S., and 4,000 in Europe. The rapidly progressing cancer is responsible for more than 80% of childhood leukemia cases. The five-year pediatric survival rate has climbed to 90% with modern therapies, though a quarter of patients relapse.
"Oncaspar is a strong strategic fit for our rapidly expanding oncology business, as it complements our R&D programs in hematologic cancers," said David Meek, head of oncology for Baxter BioScience. "The acquisition provides an immediate commercial footprint in the U.S. and Europe with a heritage of expertise in treating this challenging disease."
In addition to the currently marketed formulation of Oncaspar, Baxter BioScience intends to continue the development of a lyophilized formulation being investigated to enhance product stability to support product supply continuity.
Baxter BioScience also is acquiring a related new chemical entity calaspargase pegol, a biologic in development for the treatment of ALL with an increased shelf life that is expected to reduce dosing frequency. Further, the company plans to investigate Oncaspar for potential new indications, including in additional ALL patient populations with significant unmet needs, as well as for acute myeloid leukemia (AML).
The acquisition is expected to accelerate the company's efforts to capitalize on the rapidly growing oncology market, with an estimated $10 billion total market potential across current oncology indications for Baxter's pipeline assets. It also complements recent momentum on several partnerships within the oncology pipeline, including positive phase III results for the investigational treatment pacritinib for myelofibrosis, as well as the recent regulatory filings of MM-398 for metastatic pancreatic cancer.
Baxter will purchase the portfolio for $900 million before working capital and other transaction adjustments. This transaction is expected to be accretive to adjusted earnings on a cash basis in the first full year and increasingly accretive thereafter.