British pharmaceutical giant AstraZeneca Plc has agreed to buy gout drug maker Ardea Biosciences Inc for approximately $1.26 billion (£782 million), the companies announced on Monday.
Under the terms of the merger agreement, AstraZeneca will acquire Andrea shares for $32 apiece, including existing cash. The offered price represents a hefty premium of 50 per cent based on the one-month volume weighted average price of Andrea share and 54 per cent compared to the share's closing price on Friday.
San Diego, California-based Ardea is a biotechnology company, focused on the development of small-molecule therapeutics for the treatment of gout-a disease caused by elevated levels of uric acid in the blood stream - and cancer.
Ardea's clinically most advanced product, lesinurad, is currently in Phase III development as a potential treatment for the chronic management of hyperuricaemia in patients with gout.
According to the company, there are about 14.7 million cases of chronic gout in the major markets in 2009, which is forecast to grow to 16.6 million in 2019.
''This attractive Phase III programme is an excellent opportunity to leverage AstraZeneca's global specialty and primary care sales and marketing capabilities,'' David Brennan, chief executive officer of AstraZeneca, said.
Brennan added that lesinurad along with a promising next generation phase I drug would have real potential benefit to patients suffering from gout.
Ardea is also in the process of developing a specific inhibitor of mitogen-activated ERK kinase for cancer treatment under its global licence agreement with German pharmaceutical giant Bayer HealthCare.
Ardea's president and chief executive officer Barry D Quart said AstraZeneca's commercial strength and global reach will help realize the full potential of Ardea's programmes and its team is committed to completing the development and working to secure registration for lesinurad.
The boards of both the companies have unanimously approved the proposed transaction. The deal is expected to close by the third quarter of 2012, subject to the approval of Ardea's shareholders as well as other customary regulatory closing conditions.