GSK reaches agreement to acquire late-stage biopharmaceutical company Sierra Oncology for $1.9bn

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GlaxoSmithKline, on Wednesday, announced that the companies have entered into an agreement under which GSK will acquire a California- based Sierra Oncology, a biopharmaceutical company focused on targeted therapies for the treatment of rare forms of cancer, for $55 per share of common stock in cash representing an approximate total equity value of $1.9 billion.

“Sierra Oncology complements our commercial and medical expertise in haematology. Momelotinib offers a differentiated treatment option that could address the significant unmet medical needs of myelofibrosis patients with anaemia, the major reason patients discontinue treatment. With this proposed acquisition, we have the opportunity to potentially bring meaningful new benefits to patients and further strengthen our portfolio of specialty medicines.”

Luke Miels, Chief Commercial Officer, GSK

The acquisition, under the terms of the agreement, will be effected through a one-step merger in which the shares of Sierra Oncology outstanding will be canceled and converted into the right to receive $55 per share in cash. The value of the gross assets of Sierra Oncology to be acquired is $109 million. As per the recent release about the company’s financial state, ‘The net losses of the business were $95 million for the 12 months ended 31 December 2021.’

In January 2022, Sierra Oncology announced positive topline results from the study that demonstrated that momelotinib achieved a statistically significant and clinically meaningful benefit on symptoms, splenic response, and anaemia.

“Uniting with GSK creates the best opportunity for Sierra Oncology to realise its mission of delivering targeted therapies that treat rare forms of cancer while also delivering compelling and certain value for our stockholders. Now we have a partner with a global infrastructure and oncology expertise that enables us to deliver momelotinib to patients as quickly as possible and on a global scale.”

Stephen Dilly, MBBS, PhD, President and Chief Executive Officer, Sierra Oncology

Myelofibrosis is a deadly bone marrow malignancy that interferes with the normal creation of blood cells. In patients with myelofibrosis, anaemia is a significant unmet medical need. Approximately 40% of patients are already anaemic at the time of diagnosis, and it is expected that nearly all patients will develop anaemia at some point.

Momelotinib has the potential to improve anaemia treatment and reduce the requirement for blood transfusions while also alleviating symptoms.

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