AbbVie Agrees To Buy Peter Thiel-backed Biotech Stemcentrx
AbbVie Inc. has agreed to buy Stemcentrx, a pharmaceutical company that manufactures a late-stage lung cancer drug, in a deal valued at about $5.8 billion. The company said it will pay $2.0 billion in cash and the remainder in stock, with Stemcentrx also eligible to get up to $4 billion in cash in milestone payments. The deal is expected to close in the second quarter and to shave 20 cents off 2016 fiscal year earnings, AbbVie said. Stemcentrx, which is backed by PayPal Holdings Inc.'s co-founder Peter Thiel, has submitted its lung cancer drug Rova-T for "breakthrough therapy" designation from the Food and Drug Administration. Rova-T is intended for small cell lung cancer, a disease with no current therapy, AbbVie said. "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," said Richard A. Gonzalez, AbbVie's chairman and chief executive officer. AbbVie shares were down 1.2% in premarket trade.
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