Irvine drug maker IDM Pharma Inc. is being bought for $67 million by Japan? Takeda Pharmaceutical Co. in what? a lifeline for IDM and an expansion for Takeda.
Takeda? offer for IDM is worth 55% more than what the drug maker? stock was trading at on May 15, a few days before the deal was announced.
Takeda hasn? yet decided what it will do with IDM? operations at 9 Parker in the Irvine Spectrum, according to an IDM spokesman.
IDM, which was started in 1987, has 15 workers, all in Irvine.
The company? main product is Mepact, a drug to treat a rare form of bone cancer in children, teens and young adults.
IDM licenses Mepact from Novartis AG, a Swiss drug maker.
Mepact received European regulatory approval in March and is set to start selling there later this year, which likely spurred Takeda? offer for IDM.
The deal is a lifeline for IDM after setbacks in recent years that prompted the drug maker to scale back its operations and ambitions.
It had been working on a handful of drugs and pushing for U.S. approval of Mepact before putting those efforts on hold last year.
In March, IDM hired San Francisco investment bank JMP Securities LLC to explore a possible sale. JMP is IDM? adviser in the Takeda offer.
IDM? annual report in March included a ?oing concern?section that went into specifics about the company? ability to stay in business.
The company faced the prospect of running out of money by the third quarter, the report said.
IDM had sales of $3 million last year, largely from a research program with France? Sanofi-Aventis that? since ended.
Revenue was down by 78% in 2008.
In the first quarter, IDM had $4,000 in sales and about $7 million in cash on hand.
Last year, IDM suspended work on getting U.S. approval of Mepact and put off work on four other cancer drugs, including those for bladder and skin cancer.
Takeda could resume work on those drugs.
IDM? stock has swung wildly on news about Mepact? development during the past two years.
The company? shares shot up 167% in early 2007 after news that IDM was going to meet with regulators about Mepact.
A month later, IDM? shares gave back a good part of the gain, falling 30% after an FDA advisory panel recommended against approving the drug.
The panel said results of a third-phase clinical trial didn? show substantial evidence that Mepact was effective in treating bone cancer patients who received it as part of combination chemotherapy.
The FDA typically follows the recommendations of its advisory groups.
IDM? stock fell 20% in September 2007 after the FDA denied approval for Mepact because it wanted more clinical trial data.
Takeda? buy of IDM is expected to close next month or in July.
IDM is set to fall under Cambridge, Mass.-based Millennium: The Takeda Oncology Co., a unit of Takeda focused on cancer drugs.
Takeda, which had sales of $15 billion for the 12 months through March, bought Millennium Pharmaceuticals Inc., maker of the Velcade blood cancer drug, for $8.8 billion last year.
Takeda? European operation is set to handle sales of Mepact there.
According to Takeda, Mepact is the first treatment approved in 20 years for localized osteosarcoma, a form of bone cancer.
The disease is relatively rare?bout 1,200 cases are diagnosed in Europe each year. It can require the amputation of a limb and often is fatal.
IDM Chief Executive Timothy Walbert said in a statement that Takeda shared its goal of developing drugs to address ?ignificant unmet treatment needs.?
An article in the Nikkei Report, a Japanese newspaper, outlined Takeda? rationale in buying IDM, saying the company decided ?hat acquiring a startup that has strength in this specialized field would be the best course?for Takeda to get into the market given that there are relatively few osteosarcoma patients.
Buying IDM is part of Takeda? bid to strengthen its overseas operations as part of what the Nikkei Weekly recently called Takeda? ?ear 2010 problem.?
That? when several patents on some of Takeda? major drugs, such as Prevacid for ulcers and acid reflux disease, start to expire.
Takeda? other drugs include Actos, a diabetes treatment, for which it has a sales deal with Indianapolis-based Eli Lilly & Co.
The company also has started promoting Uloric, a treatment for gout that? the first to be marketed in the U.S. since the 1960s.
