In a significant expansion of its oncology portfolio, Jazz
Pharmaceuticals has reached an agreement to purchase Chimerix for $935 million, a deal that will bring an experimental brain cancer treatment under FDA review into Jazz’s pipeline.
The all-cash transaction, announced Wednesday, will see Jazz pay Chimerix shareholders $8.55 per share, representing a 72% premium over the company’s closing price on Tuesday. Jazz plans to finance the acquisition using its substantial cash reserves and investments, which stood at $3 billion as of late 2024. The companies expect to complete the deal during 2025’s second quarter.
The acquisition centers around dordaviprone (ONC201), Chimerix’s investigational drug currently under FDA priority review for treating gliomas with H3 27M mutations. These mutations are particularly prevalent in glioma patients under 50 years old, according to research from 2014. If approved, dordaviprone would join Jazz’s existing portfolio of five cancer medications, helping the Dublin-based pharmaceutical company reduce its revenue dependence on its leading sleep disorder treatment, Xywav.
Clinical data supporting Chimerix’s FDA submission showed promising results, with 28% of participants in a small trial experiencing either tumor shrinkage or stabilization. While this initial study lacked a control group, Chimerix is currently conducting a Phase 3 trial comparing dordaviprone to 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 retirement plans, expressed optimism about the acquisition.
“Dordaviprone shows promise as a potential standard of care in rare oncology, with the possibility of generating sustainable revenue in the near future,” he stated.
The FDA’s decision to accept the accelerated approval application may have been influenced by Chimerix’s progress in enrolling patients for the ongoing Phase 3 trial, according to Jefferies analyst Maury Raycroft. In a December client note, Raycroft projected peak sales of approximately $550 million for dordaviprone in its initial indication. The FDA is scheduled to make its decision on the drug’s approval in the third quarter.
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.
The transaction represents a strategic move for Jazz as it continues to build its presence in the oncology market. The company’s ability to leverage its substantial cash position for this acquisition
demonstrates its commitment to expanding its therapeutic portfolio beyond its traditional focus areas.
The deal also highlights the ongoing consolidation in the
biotechnology sector, particularly in oncology, where companies are seeking to strengthen their pipelines through strategic acquisitions. For Chimerix shareholders, the significant premium offered by Jazz reflects the potential value of dordaviprone and the company’s development capabilities.
As the FDA review process continues for dordaviprone, the acquisition positions Jazz to potentially introduce an important new treatment option for glioma patients, particularly those with H3 27M mutations who currently have limited therapeutic options. The transaction’s completion in the second quarter will mark a significant milestone in Jazz’s expansion strategy and could represent a new chapter in the treatment of certain brain cancers.