Gilead Sciences to Acquire Cell Design Labs for $567 Million

Gilead Sciences, Inc. GILD and its newly acquired cell therapy subsidiary –Kite Pharma- announced that they have inked an agreement to acquire Cell Design Labs, Inc. for $567 million. Gilead will also acquire 12.2% of Cell Design shares which are owned by Kite Pharma.

Cell Design Labs, is a leader in developing cell-based therapies, and uses its synNotch and Throttle technology platforms. These technological platforms will enhance Gilead’s cellular therapy research efforts which Gilead acquired through Kite Pharma acquistion. Cell Design Labs is developing several pre-clinical product candidates, including CAR T and TCR therapies for prostate cancer and hepatocellular carcinoma that use the synNotch technology. The company’s lead pre-clinical candidate targets multiple myeloma.

The addition of Cell Labs will enable Gilead to expand its CAR-T space.  . CAR-T falls under the ambit of cellular immunotherapy which involves using a patient’s own immune cells to attack and get rid of harmful disease cells in the body.

The deal includes an upfront payment of $175 million and additional payments of up to $322 million to be paid to Cell Design Labs shareholders other than Kite.

So far this year, shares of the company have gained 1.5% compared with the industry’s growth of 0.7%.

 

We note that Gilead recently received FDA approval  I for Yescarta, a CAR-T therapy for the treatment of adult patients with relapsed or refractory large B-cell lymphoma after two or more lines of systemic therapy. Yescarta is the first CAR-T therapy approved by the FDA for the indication. The drug was added to Gilead’s portfolio following the acquisition of Kite Pharma.

We further note that there are several other companies like , Novartis whose  NVS breakthrough gene transfer treatment, Kymriah (tisagenlecleucel) received FDA approval for the treatment of B-cell precursor acute lymphoblastic leukemia (ALL) that is refractory or in second or later relapse.

Another company, bluebird bio, Inc.’s BLUE anti-BCMA CAR T therapy, bb21217, is being evaluated for relapsed/refractory multiple myeloma. bb21217 as well as bb2121 are being developed in collaboration with Celgene CELG.

Gilead Sciences, Inc. Price

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Zacks Rank

Gilead carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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