Ono to Buy Deciphera for $2.4B, Looks to Expand Cancer Pipeline and US Footprint

Radiopharmaceuticals

Pictured: Illustration of cancer cells being held in the crosshairs of a scope/iStock, wildpixel

Ono Pharmaceutical said Monday it will pay $2.4 billion to acquire Deciphera Pharmaceuticals for cancer drugs that could generate peak annual sales of more than $1 billion.

Boston-based Deciphera has accepted an offer of $25.60 per share, a more than 70% premium over its closing price Friday. In return, Ono will take control of one authorized drug, one near-approval molecule and infrastructure for commercializing the assets.

Deciphera won FDA approval for the tyrosine kinase inhibitor Qinlock (ripretinib) in 2020. The approval covered the use of Qinlock in adults with advanced gastrointestinal stromal tumor (GIST) who have received prior treatment with three or more kinase inhibitors including imatinib, the drug Novartis sells as Gleevec. The European Medicines Agency authorized Qinlock in 2021.

Qinlock generated 25% growth in the U.S. and a 33% jump in overseas sales in 2023. Globally, sales topped $159 million. Deciphera attributed the growth to strong demand in the fourth-line setting, off-label use in earlier lines of GIST and the increased average duration of therapy. The company tipped the same factors to drive growth in 2024.

In the longer term, Deciphera is running a Phase III trial in second-line GIST patients with mutations in KIT exon 11 and 17/18 to support an application to expand Qinlock’s label. The drugmaker has said the label expansion has the potential to double peak sales.

Deciphera has built a specialist sales force to target physicians who treat GIST in the U.S. and created a commercial team to manage relationships with key accounts such as managed care organizations. Ono is working to develop a sales structure in the U.S. in anticipation of launching assets such as its lymphoma treatment ONO-4059.

Infrastructure established for Qinlock could support the planned launch of another asset that Deciphera has hopes of generating peak sales of more than $1 billion. The other molecule is vimseltinib, a kinase inhibitor of CSF1R that the company has linked to improved outcomes in tenosynovial giant cell tumor (TGCT). Deciphera’s claims analysis shows a 70% to 80% overlap between GIST and TGCT prescribers.

Deciphera plans to file for FDA approval of vimseltinib in the second quarter of 2024 based on a study that hit its primary and key secondary endpoints. The company forecasts the total addressable market for TGCT at around $700 million.

Daiichi Sankyo won FDA approval for Turalio (pexidartinib) in TGCT in 2019 but has a black box warning for serious and potentially fatal liver injury. Deciphera CEO Steven Hoerter told investors on an earnings call in February 2024 that vimseltinib has “a very clean and well-characterized safety profile” and “there's no reason to expect a REMS program or a black box warning.”

Nick Paul Taylor is a freelance pharmaceutical and biotech writer based in London. He can be reached on LinkedIn.

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