Gilead (GILD) to Buy MYR GmbH for EUR1.15 Billion in Cash
Gilead Sciences, Inc. GILD announced that it will acquire a private, commercial stage German biotechnology company MYR GmbH for €1.15 billion in cash, payable upon closing the transaction along with a potential future milestone fee of up to €300 million (both payments are subject to customary adjustments).
The acquisition will add hepatitis delta virus (HDV) treatment Hepcludex (bulevirtide) to Gilead’s portfolio.
Hepcludex is a first-in-class treatment of HDV that blocks viral entry into liver cells through binding to NTCP.
The treatment was conditionally approved by the European Medicines Agency (EMA) in July 2020 to address chronic HDV infection in adults with compensated liver disease. It is already launched in France, Germany and Austria. Per management, HDV is the most severe form of viral hepatitis and can have mortality rates as high as 50% within five years of getting affected among cirrhotic patients. It occurs only as a co-infection in individuals who have hepatitis B virus (HBV).
Submission for an accelerated approval of Hepcludex in the United States is anticipated in the second half of 2021. It was granted both Orphan Drug and Breakthrough Therapy designations for chronic HDV infection.
Data from the phase II study MYR202 showed that 54 of 90 patients treated with bulevirtide plus tenofovir disoproxil fumarate (TDF) had at least a 2 log10 HDV RNA decline or undetectable HDV RNA at week 24 compared with 1 of 28 patients given TDF alone. Meanwhile, in the phase II study MYR203, 15 patients were treated with Hepcludex 2mg daily monotherapy for 48 weeks. The safety and efficacy profiles were similar to patients treated for a 24-week regimen in combination with TDF in the MYR202 study in this limited patient population. Interim 24-week data from the ongoing phase III study (MYR301) of bulevirtide is awaited in the first half of 2021 and is expected to serve as the basis of filing the accelerated nod in the United States.
The acquisition further fortifies Gilead's position as a global leader in virology and liver diseases with the addition of the first marketed product for the treatment of HDV.
The stock has lost 6.5% in the year so far against the industry's growth of 7.1%.
Gilead has been entering into strategic collaborations and making acquisitions to strengthen its portfolio/pipeline in recent times.
Earlier, the company acquired Immunomedics for approximately $21 billion.
The massive decline in Gilead’s HCV franchise sales propelled it to focus on its HIV franchise Yescarta and other newer avenues. The rapid adoption of Biktarvy maintains momentum in the HIV space amid stiff competition from the likes of GlaxoSmithKline GSK. However, the company is looking to diversify its portfolio, given the rising competition in the HIV space.
Gilead currently carries a Zacks Rank #4 (Sell).
A few better-ranked players in the biotech space are Halozyme Therapeutics, Inc. HALO and Repligen RGEN, which carry a Zacks Rank #2 (Buy), presently. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Halozyme’s current-year earnings estimates have been revised 21 cents upward in the past 60 days.
Repligen’s earnings per share estimates have moved up from $1.42 to $1.66 for 2021 in the past 60 days.
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