Bristol-Myers Squibb To Buy Biotech Firm Adnexus

Bristol-Myers Squibb (BMS) will acquire the privately held biopharmaceutical company Adnexus Therapeutics for $430 million. The purchase is the latest step in the big drug company's program to expand its presence in large-molecule, or biologic, pharmaceuticals.

Adnexus has a cancer therapy called Angiocept in Phase I clinical trials. It is part of a class of biologics the firm calls Adnectins, which are based on human fibronectin, an extracellular protein that is naturally abundant in human blood serum. Earlier this year, Adnexus and BMS formed a $30 million partnership to develop Adnectins. Adnexus also has a protein design technique called PROfusion.

"Biologics are one cornerstone of our growth strategy," says BMS CEO James M. Cornelius. "This investment in biologics discovery complements our continued investment in a growing biologics pipeline and portfolio."

Martha Freitag, an analyst with Argus Research, says the deal is "reasonably priced and a complementary addition to BMS's oncology development portfolio."

It also advances the firm's biologics pipeline, Freitag says. She notes that BMS has partnerships with Medarex for ipilimumab, a monoclonal antibody treatment for melanoma currently in Phase III clinical trials, and with ImClone Systems for Erbitux, a head and neck cancer antibody that is in Phase III trials for new indications.

Freitag adds that Angiocept takes a similar approach to Genentech's cancer treatment Avastin, targeting vascular endothelial growth factor.

BMS manufactures biologic compounds in Syracuse, N.Y., and is building a large-scale bulk biologics plant in Devens, Mass. Announced in 2006, the plant is expected to be completed in 2009 at a cost of $750 million. Among other things, it will manufacture Orencia, an arthritis treatment that is the company's first internally discovered biologic compound.