Celgene buys rival Gloucester for $640 million, gaining rights to Istodax; Allos defends price of Folotyn

Celgene Corp says it has entered into a definitive agreement to acquire fellow USA-based rival acquire Gloucester Pharmaceuticals., in a two-part deal valuing the latter at some $640 million and provide it with rights to a new blood cancer drug, Istodax (romidepsin). The transaction has been approved by both firms' boards of director and is subject to customary closing conditions.

Under the terms of the accord, Celgene will acquire Gloucester for $340 million in cash plus $300 million in future US and international regulatory milestone payments. The acquisition will be accounted for as a purchase transaction that Celgene expects to be completed in the first quarter of 2010 and to be neutral to non-GAAP diluted earnings for 2010 and accretive in 2011.

Celgene says the acquisition will continue to advance its leadership position in the development of disease-altering therapies through innovative approaches for patients with rare and debilitating blood cancers. Gloucester Pharmaceuticals develops new therapies that address the unmet medical needs in the treatment of cancer, including cutaneous T-cell lymphoma (CTCL), peripheral T-cell lymphoma (PTCL) and other hematological malignancies. This means that Celgene will become a likely competitor to Allos Therapeutics, which is in the process of launching its PTCL treatment Folotyn (pralatrexate, injection), following US approval in September.