By Stephanie Murg, Managing Director, G2 Intelligence
Roche is betting big on cancer genomics. The Swiss pharmaceutical giant has agreed to acquire a majority stake in Foundation Medicine (Cambridge, Mass.), which uses genetic sequencing to optimize treatment selection for cancer patients. The deal, announced Monday, calls for Roche to buy approximately 15.6 million shares (56.3 percent) of Foundation Medicine in a $780 million tender offer that represents a 109 percent premium to the company’s closing price of last Friday. Additionally, Roche will acquire 5 million newly issued shares for $250 million. The deal is expected to close in the second quarter of this year.
Founded in 2010 to exploit a growing understanding of the molecular basis of cancer, Foundation Medicine supports physicians by providing comprehensive molecular information to characterize a tumor that is being matched with approved targeted therapy options and novel treatments under development.
Framed as a “broad strategic collaboration” that will expand both companies’ personalized health care initiatives in oncology, the deal includes an R&D commitment that will see Roche invest potentially more than $150 million in Foundation Medicine. The initial focus of the R&D partnership, slated to last at least five years, will be developing genomic profile tests for cancer immunotherapies and for continuous blood-based monitoring.
Roche plans to apply Foundation Medicine’s proprietary molecular information platform to standardize clinical trials, while current and future tests developed by the company are expected to support development of combination therapies, novel targets, more accurate patient population identification and inclusion in clinical trials, and next-generation companion diagnostics.