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Germany's Bayer will pay $2 billion upfront and up to an
additional $2 billion in milestone payments contingent on
development achievements, it said on Monday.
The North Carolina-based takeover target, also known as AskBio,
is trying to use the harmless adeno-associated virus as a
delivery device to bring genetic repair kits against a range of
diseases into the body.Drugs and farming pesticides maker Bayer
needs to upgrade its drug development pipeline amid a weaker
outlook for agricultural sales and as it seeks to finalise an
$11 billion settlement over claims its Roundup weedkiller causes
cancer.
Among AskBio's most advanced projects are early tests on
volunteers of prospective treatments against Pompe disease - a
rare genetic disease causing buildup of a sugar molecule inside
cells - as well as against Parkinson's disease and congestive
heart failure.
Bayer said the deal complements the 2019 acquisition of BlueRock
Therapeutics, a developer of stem cell therapies, and
underscores Bayer's intention to create a cell and gene therapy
business.
AskBio, which was founded in 2001, and BlueRock will exchange
information and collaborate but will each operate as independent
entities, prompting a pledge from AskBio's five main owners, who
are co-founders or key scientists, to remain with the firm.
"We are staying on board because of the unique structure that
Bayer has provided ... We’ll have the ability to make our
science decisions," said Chief Executive Officer and co-founder
Sheila Mikhail.
Investors TPG Capital and Vida Ventures are selling a minority
stake in the company.
AskBio is also helping other companies with their gene therapy
research and production and has licensed experimental drugs to
external partners, which has financed much of its own drug
development activities. Bayer or AskBio would not provide
figures for such fee revenues.
A potential treatment of Duchenne Muscular Dystrophy, invented
by AskBio is currently being developed in clinical trials by
Pfizer and this month won fast track https://www.pfizer.com/news/press-release/press-release-detail/pfizer-receives-fda-fast-track-designation-duchenne
status from U.S. regulators.
Bayer in 2018 moved to lean more strongly on external firms to
improve drug development, which analysts say needs a boost to
make up for an expected decline in revenues from its two pharma
bestsellers from about 2024.
Credit Suisse was financial advisor while Baker McKenzie was
legal counsel to Bayer. JP Morgan was financial advisor to
AskBio, while Ropes & Gray was legal counsel.
(Reporting by Ludwig Burger; Editing by Frances Kerry)
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