AstraZeneca (NYSE:AZN), a U.K. pharmaceutical company, today announced its pending purchase of U.S.-based biotech company Ardea Biosciences (NASDAQ:RDEA) for $1.26 billion. The deal is just one example of the buyout frenzy taking place in the biotech sector.
AstraZeneca had already stated its intentions to purchase smaller companies to help offset the impact from generic-drug competitors, said The Wall Street Journal in a report. Under the agreement terms, the U.K. company will purchase Ardea, which produces small-molecule drugs, for $32 a share.
A gout drug that the biotech company is currently working on got the attention of AstraZeneca, according to Martin Mackay, head of research and development for U.K.’s second-largest drugmaker.
“While this is not a therapeutic area we do internal work on, we know there’s a significant unmet medical need in terms of patients and the good news about this particular molecule is that it works. So we’re being opportunistic here [by buying Ardea],” Mackay told the WSJ.
The deal with Ardea is AstraZeneca’s largest acquisition in five years, but it may be the first of many more purchases, according to Bloomberg.
“We’re building some momentum here in R&D,” Mackay, told the news service in a telephone interview. “I would be disappointed if we didn’t announce further deals by the end of this year. We’ve taken our hits but we’re turning a corner.”