The transaction, which has been unanimously approved by the Board of Directors of both the companies, is expected to be completed in the third quarter of 2023, and CTI is expected to become a wholly owned subsidiary of Sobi, upon closing
Karolinska Institutet Science Park. (Credit: I99pema/Wikipedia)
Swedish Orphan Biovitrum (Sobi) has signed an agreement to acquire CTI BioPharma, a US-based biopharmaceutical firm focused on therapies for blood-related cancers rare diseases, for a total consideration of $1.7bn.
Under the terms of the agreement, Sobi, through its indirect subsidiary, will acquire all the outstanding shares of CTI at a purchase price of $9.10 per share, in cash.
The acquisition price represents a 95% premium to CTI’s 30-day volume-weighted average price of $4.67 prior to the announcement.
Board of Directors of both the companies have unanimously approved the transaction.
In addition, Sobi has received an irrevocable undertaking from certain affiliates of BVF Partners to tender their entire shareholding, which constitutes about 6.7%.
The transaction is expected to be completed in the third quarter of 2023.
Upon completion of the transaction, CTI will become a wholly owned subsidiary of Sobi.
CTI BioPharma president, chief executive officer and interim chief medical officer Adam Craig said: “We are delighted to announce this transaction, which delivers a compelling all-cash premium to our shareholders, while positioning CTI to unlock the full potential of VONJO in treating myeloproliferative disease.
“In Sobi, we’ve found a global partner whose mission, culture and strategic business priorities are aligned with ours, and by joining forces, we have access to additional financial and development resources to drive and enhance the growth of VONJO.
“As we enter CTI’s next chapter with the support of Sobi, we’d like to recognize the extraordinary work of our talented employees, who will play a key role in the success of the combined company.”
The acquisition will add CTI’s lead candidate Vonjo (pacritinib), further strengthening and diversifying Sobi’s portfolio of haematology medicines.
VONJO is approved in the US, for the treatment of adults with intermediate- or high-risk primary or secondary myelofibrosis with a platelet count below 50×109/L.
CTI is currently conducting the Phase 3 PACIFICA clinical trial of Vonjo, in patients with myelofibrosis and severe thrombocytopenia, as a post-marketing requirement.
Sobi intends to pay up to half of the consideration through an issuance of new ordinary shares of Sobi with preferential rights to its existing shareholders, after closing.
Also, the company has secured debt financing commitment from Bank of America and Danske Bank, to fund the remaining portion of the consideration.
BofA Securities served as exclusive financial advisor, and Latham & Watkins as legal advisor to Sobi on this transaction.
Centerview Partners and MTS Health Partners served as financial advisors, and Skadden, Arps, Slate, Meagher & Flom and Gibson, Dunn & Crutcher as legal counsel to CTI.
Sobi president and CEO Guido Oelkers said: “CTI represents a perfect fit for Sobi’s haematology franchise today, adding a powerful and highly differentiated new product that will make a significant difference for patients.
“There is a large unmet medical need within myelofibrosis, in particular for patients suffering from thrombocytopenia who are inadequately treated by existing medicines.
“The combination of the talented team at CTI, together with Sobi’s broad US and global haematology capabilities, will help get this much needed new therapy to patients faster and more effectively.”