Shares in the biotechnology firm Ariad Pharmaceuticals soared 73 percent on Monday after the company announced its buyout from leading Japanese pharmaceutical company Takeda Pharmaceuticals. This is Ariad’s best trading day in 17 years.
In the deal, Takeda agreed to buy Ariad for a price of $24 per share, in cash, a value that represents roughly $5.2 billion. Both Ariad and Takeda boards have signed off on the deal, so it is expected to close by the end of February.
In a news release, Ariad chairman Alexander Denner explains, “This transaction is a great outcome for shareholders of Ariad and Takeda. Both Ariad and Takeda are passionate about helping cancer patients, and I believe the talent and resources of Takeda coupled with Ariad’s pipeline and people will accelerate the development of cancer treatments.
In addition, Takeda president and chief executive officer Christophe Weber comments, “The acquisition of Ariad is a unique opportunity that will enable us to positively impact the lives of more patients worldwide, advance our strategic priorities and generate attractive returns for our shareholders.”
Ariad’s general area of focus are its leukemia treatments Iclusig and Brigatinib, which are investigational treatments for non-small cell lung cancer.
Weber, however, goes on to say, “We will broaden our hematology portfolio and transform our global solid tumor franchise through the addition of two innovative targeted therapies.”
Overall, Takeda comments that this acquisition “brings two innovative targeted therapies that will expand and enhance Takeda’s existing oncology portfolio [and] will position Takeda for sustainable long-term growth in oncology.”
Finally, Ariad board chair Alexander J. Denner explains that this is a symbiotic transaction for all parties involved. He says, “Both Ariad and Takeda are passionate about helping cancer patients, and I believe the talent and resources of Takeda coupled with Ariad’s pipeline and people will accelerate the development of cancer treatments.”
Ariad’s stock has shown steady growth throughout 2016, increasing 99.04 percent over the course of last year. And the stock has already surged 90 percent on the year, so far; though Takeda projects that the Ariad acquisition will not really have much effect on this year. They expect, however, that the merger will be far more productive in 2018.