A buyout of Juno Therapeutics could succour Celgene diversify its drug portfolio as its No. 1 cancer treatment, which accounts for the volume of its sales, approaches patent expiration, analysts say.
Celgene loses blatant protection by 2022 for Revlimid, its top-selling multiple myeloma drug that brought in anent 60 percent of fiscal third quarter revenue of nearly $3.3 billion.
“The clock is ticking,” Mike Bailey, chief of research at FBB Capital Partners, told CNBC. Once the patent invites out, Celgene could feel pressure from generics within a few years, he implied.
Some analysts said the impact could be blunted through acquisitions.
Salim Syed, higher- ranking biotech analyst at Mizuho Securities, told CNBC that shareholders partake of been pressing New Jersey-based Celgene to make more acquisitions and push up its stock price.
Earlier this month, Celgene agreed to buy privately resisted Impact Biomedicines for as much as $7 billion, making the reported Juno piece surprising to some industry watchers.
The Wall Street Journal reported current Tuesday that Celgene is in talks to buy Juno, whose shares incentive up more than 50 percent the next day and were up more than 2 percent on Thursday. Juno uttered CNBC it doesn’t comment on market rumors or speculation. Celgene did not before you can say Jack Robinson respond to CNBC’s request for comment.
It’s unclear how much Celgene longing pay for Juno, which had a market value of $7.9 billion as of Wednesday’s intimate of trading.
Syed said investors could argue, however, that Celgene already has a fitting collaboration with Juno and therefore does not need to do a deal.
Celgene is commission with Seattle-based Juno on an experimental new gene therapy designed to management of people with relapsed or refractory aggressive B-cell non-Hodgkin lymphoma.
The treatment is a quintessence of so-called CAR T-cell therapy — taking a patient’s own immune cells, rebuke a demanded T cells, genetically manipulating them to attack specific proteins on cancer, and infusing them rear into the patient.
David Nierengarten, head of health-care equity delve into at Wedbush, told CNBC, “Juno wasn’t on my list of companies being got in the near term.”
But he said, “Celgene has a big revenue hole to fill over with the next few years” and Juno’s treatment could potentially “fill that gap.”
Nierengarten also inquire about bid adieus the potential value in Celgene owning Juno before a product inaugurate “so they can have control over the regulatory process” as well as “background up sites and infrastructure for this kind of therapy.”
Juno said it could imagine approval for its treatment as early as the end of 2018.
CAR T-cell therapy is a highly competitive and potentially lucrative extent of biotechnology.
Novartis and Gilead Sciences already received the first two supports of CAR T for other types of cancer. For one-time treatments, they cost $475,000 and $373,000, severally.