Celgene to Acquire Abraxis for $2.9 Billion

In an effort to strengthen its oncology pipeline, Celgene Corporation (Summit, NJ) will acquire California-based Abraxis BioScience Inc. for approximately $2.9 billion in stock and cash. The transaction adds Abraxane, an injectable drug that is approved as a treatment for metastatic breast cancer and is being studied in a number of other solid tumors including lung and pancreatic cancers, to Celgene’s existing portfolio of cancer drugs.

Under the terms of the merger agreement, each share of Abraxis BioScience common stock will be converted into the right to receive an upfront payment of $58 in cash and 0.2617 shares of Celgene common stock. Each share will also receive one tradeable contingent value right, which entitles its holder to receive payments for future regulatory milestones and commercial royalties. The acquisition of Abraxis is expected to close in the fourth quarter of 2010.

Celgene may explore the application of Abraxane’s “nab” technology to other compounds. Celgene’s two top-selling drugs are Revlimid and Thalomid, which are treatments for multiple myeloma. In January, Celgene acquired Gloucester Pharmaceuticals Inc., gaining the marketed lymphoma drug Istodax.