Gilead swoops on Forty Seven with $4.9bn all-cash deal

Gilead Sciences has bulked up its oncology pipeline with a $4.9 billion all-cash deal to acquire Forth Seven, which specialises in cancer immunotherapies targeting the CD47 immune checkpoint.

Gilead is paying $95.50 per share for Forty Seven and its lead drug magrolimab, a 60% premium to the biotech’s closing share price on Friday, although shares in the biotech have been rising on speculation of a deal.

CD47 is a cell membrane receptor belonging to the immunoglobulin (Ig) superfamily, which is found on the surface of many tumour types and seems to protect against their destruction by the immune system by sending out a ‘don’t eat me’ signal to macrophage cells.

Studies have also suggested that blocking CD47 can send some tumour cells into programmed cell death (apoptosis).

Forty Seven is one of clutch of biotechs trying to develop drugs that target the CD47 pathway and its founder – Stanford University researcher Irv Weissman – is one of the scientists credited with discovering the protein’s role.

Magrolimab (formerly Hu5F9-G4) generated positive results in a phase 1b study reported at the ASH conference in the US in December, which revealed a 92% overall response rate – including 50% complete responses – in untreated patients with myelodysplastic syndromes (MDS) and acute myeloid leukaemia (AML).

Forty Seven is also testing the drug in patients with non-Hodgkin's lymphoma, diffuse large B-cell lymphoma and three solid tumours – colorectal, ovarian and bladder cancer.

“This transaction supports our strategic focus in oncology and gives access to a potential new first-in-class programme,” said Gilead, which expects the deal to close during the second quarter of 2020, subject to regulatory approvals and other conditions.

The takeover is the latest in a string of big billion dollar-plus licensing and acquisition deals signed by Gilead since the start of 2019 under new chief executive Daniel O’Day as the company tries to bulk up its pipeline amid pressure for its HIV and hepatitis franchises.

The biggest deal was its $5.1bn strategic-level tie-up with Galapagos last year, which doubled its R&D capacity and added at least six drugs headed by autotaxin inhibitor GLPG1690 in phase 3 for idiopathic pulmonary fibrosis (IPF).

It also signed a $2.35bn deal with Nurix for protein degradation drugs for cancer and other diseases, and a $2bn alliance with Goldfinch Bio in the kidney disease area, continuing a run of M&A that hit a peak in 2017 with Gilead’s $11.9bn acquisition of CAR-T cell therapy player Kite Pharma.

“Magrolimab complements our existing work in haematology, adding a non-cell therapy programme that complements Kite’s pipeline of cell therapies for haematological cancers,” said O’Day.

“With a profile that lends itself to combination therapies, magrolimab could potentially have transformative benefits for a range of tumour types,” he added.