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Bio Buyout Spree Continues as SeaGen Bets $614M on Cascadian Cancer Drug

Xconomy Seattle — 

In the latest in a recent spate of biopharma buyouts, Seattle Genetics has struck a deal to acquire Cascadian Therapeutics, gambling on an experimental breast cancer drug in late-stage testing.

SeaGen (NASDAQ: SGEN), of Bothell, WA, will pay $10 per share in cash, or $614 million, for Seattle’s Cascadian (NASDAQ: CASC) and its lead drug tucatinib, being developed for women with HER2-positive metastatic breast cancer. The deal represents a 69 percent premium on Cascadian’s $5.60 per share closing price on Tuesday.

Tucatinib is currently being tested in a group of different combination studies, among them a pivotal trial, HER2CLIMB, combining the drug with trastuzumab (Herceptin) and capecitabine (Xeloda) in patients whose advanced or metastatic breast cancer expresses the protein HER2 and may or may not have spread to the brain. Cascadian reported encouraging early data on the drug in breast cancer patients who had failed multiple treatments and whose tumors had spread to the brain. The FDA then cleared the company, in late 2016, to expand that study, known as HER2CLIMB and use it to form the basis of an approval application. Results are expected in 2020.

SeaGen, best known for its blood cancer drug brentuximab vedotin (Adcetris), is betting not only that the Cascadian will come through in HER2CLIMB, but that tucatinib will have a role, commercially, in earlier breast cancer treatment regimens amidst competition from similar therapies like Puma Biotechnology’s (NASDAQ: PUMA) neratinib (Nerlynx). Cascadian also has earlier stage studies underway in other types of breast and colorectal cancer.

The deal marks the end of a long and rocky road for Cascadian, a company once known as Oncothyreon. Cascadian has had its share of financial crises and clinical setbacks over the years, most notably the failure of a cancer vaccine known as Stimuvax. But a fortuitous $20 million licensing deal with Array Biopharma (NASDAQ: ARRY) in 2014 gave it tucatinib, once known as ONT-380, which is its only drug currently in human testing and led to today’s buyout.

Here’s more on the history of Oncothyreon and some of its ups and downs over the years.