AstraZeneca, the renowned British pharmaceutical giant, recently confirmed its plan to acquire Fusion Pharmaceuticals for around $2.4 billion.
The payment plan includes an upfront cash payment of $2 billion, with the potential for additional payments dependent on specific agreed-upon contingencies. As per the agreement, AstraZeneca, via a subsidiary, will purchase each share of Fusion at a cash price of $21 upon closure. This arrangement also encompasses a contingent value right of $3.00 per share in cash, deliverable upon meeting specified regulatory milestones.
The prepaid cash portion signifies a 97% premium to Fusion's market closing price of $10.64 as of March 18 and an 85% premium to the volume-weighted average price prior to the finalisation of this agreement. The overall value of the transaction shows a 126% premium to Fusion's closing price on March 18 and a 111% premium on the 30-day volume-weighted average rate.
As an integral part of this acquisition, AstraZeneca will attain the cash, cash equivalents, and short-term investments from Fusion's account balance, which stood at $234 million at the close of December 31, 2023. The acquisition is projected to culminate by the second quarter of 2024, reliant on typical closing conditions.
Fusion Pharmaceuticals, a clinical-stage biopharmaceutical company dedicated to creating cutting-edge radioconjugates for cancer treatment, will shift into a subsidiary of AstraZeneca. The company’s operations will persist in both Canada and the US.
This strategic acquisition will fortify AstraZeneca's oncology portfolio by incorporating Fusion's pipeline of radioconjugates, including their most pioneering project, FPI-2265. This is a potentially disruptive treatment for patients suffering from metastatic castration-resistant prostate cancer (mCRPC).
By focusing on the prostate-specific membrane antigen (PSMA), a protein abundantly expressed in mCRPC, FPI-2265 is currently in its Phase II trial phase. Through this acquisition, AstraZeneca aims to advance cancer treatment and patient outcomes by superseding traditional chemotherapy and radiotherapy methods with more personalised and targeted treatments.
