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BMS offers $2.5bn to make Inhibitex its latest 'pearl'

Acquisition would boost firm's virology business

Bristol-Myers Squibb (BMS) has made a $2.5bn offer for Inhibitex in a bid to boost its portfolio of drugs to treat hepatitis C.

The announcement is the latest phase in BMS' much-touted 'string of pearls' approach to drug development, which relies on complementing internal R&D with a suite of alliances, partnerships and acquisitions in its core therapeutic areas.

Inhibitex is the latest 'pearl' in the string of more than a dozen deals announced since 2007, fitting into BMS' virology business with its lead compound INX-189, an oral nucleotide polymerase (NS5B) inhibitor for hepatitis C.

The compound is currently in phase II testing and has shown "potent antiviral activity, a high barrier to resistance and pan-genotypic coverage", according to BMS.

Russell Plumb, Inhibitex's chief executive, said that the deal "puts INX-189 and the company's other infectious disease assets in the hands of an organisation that can more optimally develop them".

BMS has been making a series of deals in an attempt to combine its own hepatitis C drug candidates - led by NS5A replication complex inhibitor daclatasvir (BMS-790052) in phase III - with compounds in development at other companies.

The overall aim is to develop all-oral treatment regimens that could replace the current therapies based on injectable interferon alpha.

Analysts have predicted multibillion dollar sales for a number of oral hepatitis C therapies coming through pharma company pipelines, and the sector has been invigorated recently by approvals for new oral therapies.

These include Merck & Co's Victrelis (boceprevir) and J&J, Vertex Pharmaceuticals and Mitsubishi Tanabe's Incivek/Incivo (telaprevir).

Last month BMS forged an alliance with Johnson & Johnson's Tibotec unit for the development of an all-oral combination therapy based on daclatasvir and Tibotec's NS3 protease inhibitor TMC435. Phase II trials of the regimen are due to start later this year.

Meanwhile, in early 2011 BMS entered into a similar agreement to evaluate daclatasvir alongside Pharmasset's nucleotide polymerase inhibitor PSI-7977. Pharmasset has since entered into an agreement to be bought by Gilead Sciences for $10.8bn.

In addition to INX-189, Inhibitex's antiviral portfolio includes FV-100, a nucleoside analogue for shingles in phase II, as well as a series of follow-up hepatitis C-targeting nucleotides in early-stage development.

Alongside that portfolio is an antibacterial programme headed by Aurexis, a monoclonal antibody against Staphylococcus aureus in phase II testing, and a staphylococcal vaccine programme which is partnered with Pfizer.

The US pharma major is offering $26 per share for Inhibitex, a 163 per cent premium to the firm's closing share price on January 6, the day before the announcement.

Inhibitex's board of directors has already given its support to the deal, as have 17 per cent of the company's shareholders, said BMS in a statement.

9th January 2012

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