BeiGene deal with Amgen includes $2.7 billion investment for 20.5% stake

Having closed Wednesday regular trading down marginally on Thursday, China’s BeiGene (Nasdaq: BGNE) shot up 22.9% to $170.00 in after-trading as it announced a strategic collaboration with US biotech giant Amgen (Nasdaq: AMGN) under which the companies will collaborate on (i) the commercialization of Amgen’s oncology products Xgeva (denosumab), Kyprolis (carfilzomib) and Blincyto (blinatumomab) in China, and (ii) global development and commercialization in China of 20 Amgen clinical- and late-preclinical-stage pipeline products.

Additionally, Amgen will acquire a 20.5% post-closing equity stake in BeiGene at a 36% premium to the 30-day volume weighted average price of the company’s American Depositary Shares on the Nasdaq as of October 30, 2019, for a total of around $2.7 billion, valuing the Chinese biotech at around $13.5 billion.

The transactions have been approved by the boards of directors of both companies and are expected to close in the first quarter of 2020, subject to approval by a majority vote of the company’s shareholders and other standard conditions.