Ono Pharmaceutical Co., a prominent Japanese pharmaceutical firm, has announced a major strategic move with its planned acquisition of American cancer drug maker Deciphera Pharmaceuticals for $2.4 billion. This acquisition marks Ono’s largest to date and is set against the backdrop of looming patent expirations for its leading cancer immunotherapy, Opdivo, starting in 2028.
On Tuesday, Ono disclosed that it had reached an agreement to purchase all outstanding shares of Nasdaq-listed Deciphera at $25.60 per share, a 74.7% premium over the stock’s closing price last Friday. The transaction is expected to be finalized in the third quarter of this year.
Deciphera Pharmaceuticals, founded in 2003, is recognized for its Qinlock cancer drug, which is already on the market in the U.S. and Europe. Qinlock operates through a unique mechanism that inhibits enzymes essential for the proliferation of cancer cells. In 2023, Deciphera reported global revenues of $163 million, primarily from Qinlock sales. Ono projects that sales of Qinlock could reach between $350 million to $400 million at their peak.
Additionally, Deciphera has several promising drug candidates in its pipeline. This includes a treatment for benign tumors in joints, which is nearing the end of clinical trials in Europe and the U.S., with plans for submission for approval in 2024. Another candidate in development targets complications arising from blood cancer treatments, with potential peak sales estimated at $700 million annually.
The acquisition is a critical part of Ono’s strategy to mitigate the expected decline in revenue from Opdivo due to patent expirations. It also aims to enhance Ono’s presence in international markets, particularly in Europe and the U.S., where it has previously relied on partnerships due to a lack of a robust sales network. The company plans to expand its U.S. East Coast development and sales hub to approximately 170 staff and establish a new hub in Europe.
This strategic expansion comes at a time when global pharmaceutical companies are fiercely competing to develop and market new oncology drugs. With the industry’s high stakes and profitability, Ono’s acquisition of Deciphera not only diversifies its portfolio but also strengthens its position in the global pharmaceutical market.
