In a significant expansion of its oncology portfolio, Jazz
Pharmaceuticals has reached an agreement to purchase Chimerix for $935 million, a deal announced on Wednesday that will bring an experimental brain cancer treatment under its umbrella.
The all-cash transaction values Chimerix shares at $8.55 each, representing a substantial 72% premium over the company’s closing price on Tuesday. Jazz plans to utilize its considerable cash reserves and investments, which stood at $3 billion as of late 2024, to finance the acquisition. The companies anticipate finalizing the deal during 2025’s second quarter.
Central to the acquisition is dordaviprone (also known as ONC201), Chimerix’s promising cancer drug currently under FDA review. The medication targets gliomas specifically containing an H3 27M mutation, which research from 2014 indicates is particularly prevalent in glioma patients under 50 years old.
The drug’s FDA submission for accelerated approval is backed by clinical data showing meaningful results – 28% of participants in a small study experienced either tumor shrinkage or stabilization. While this initial study lacked a control group, Chimerix is currently conducting a more comprehensive Phase 3 trial comparing dordaviprone against placebo in post-radiation therapy glioma patients, with interim results expected in 2025’s third quarter.
Bruce Cozadd, Jazz’s chairman and CEO who recently announced his upcoming retirement, expressed optimism about the acquisition: “Dordaviprone shows promise to become a standard treatment option for this rare oncology indication while generating sustainable revenue in the near future.”
The FDA’s acceptance of the accelerated approval application may have been influenced by Chimerix’s progress in enrolling patients for its Phase 3 trial, according to Jefferies analyst Maury Raycroft. The application has received priority review status, with a decision anticipated in the third quarter. Raycroft projects potential peak sales of approximately $550 million for the drug’s initial indication.
If approved, dordaviprone would join Jazz’s existing portfolio of five cancer medications, helping the Dublin-based pharmaceutical company reduce its revenue dependence on Xywav, its leading sleep disorder treatment.
The merger brings together two veteran companies in the biotechnology sector. Jazz, established in 2003, began with a focus on neurology and psychology medications, while Chimerix, founded in 2002, initially concentrated on developing antiviral treatments for smallpox and HIV.
This strategic acquisition reflects Jazz’s commitment to strengthening its presence in oncology while providing Chimerix shareholders with significant value. The deal also demonstrates the ongoing
consolidation within the biotechnology industry as companies seek to expand their therapeutic offerings and research capabilities.
The transaction comes as Jazz prepares for a leadership transition, with CEO Cozadd, who helped establish the company, planning to step down. The timing of the acquisition suggests Jazz’s determination to solidify its market position and pipeline before this significant organizational change.
The addition of dordaviprone to Jazz’s oncology portfolio could represent a significant advancement in treating rare brain cancers, particularly for younger patients affected by H3 27M-mutated gliomas. The drug’s potential approval and commercialization would address an important unmet medical need while potentially providing Jazz with a new revenue stream to support its continued growth and development in the oncology sector.