Spectrum Pharmaceuticals to divest seven oncology drugs in $300m deal with Acrotech Biopharma

In a major strategic move, Spectrum Pharmaceuticals, a prominent US-based biopharma company, has entered into a deal with Acrotech Biopharma, a subsidiary of Aurobindo Pharma USA, to sell seven FDA-approved oncology and hematology drugs for approximately $300 million. The decision is part of Spectrum’s broader strategy to pivot towards innovative cancer therapies, according to the company’s leadership.

The transaction includes well-established drugs such as FUSILEV (levoleucovorin), FOLOTYN (pralatrexate injection), ZEVALIN (ibritumomab tiuxetan), MARQIBO (vincristine sulfate liposome injection), BELEODAQ (belinostat), EVOMELA (melphalan) for injection, and KHAPZORY (levoleucovorin). Collectively, these products generated $76.4 million in sales during the first nine months of 2018. However, Spectrum Pharmaceuticals has opted to refocus its resources on novel oncology treatments.

Joe Turgeon, President and CEO of Spectrum Pharmaceuticals, expressed that the divestiture was a “major strategic shift” to enhance the company’s focus on developing and commercializing cutting-edge oncology drugs. He further emphasized that the sale would substantially improve Spectrum’s financial standing, providing capital to advance the company’s two late-stage pipeline assets, including ROLONTIS (eflapegrastim) and poziotinib, and positioning it for further growth.

The terms of the agreement stipulate that Acrotech Biopharma will pay Spectrum Pharmaceuticals $160 million in upfront cash, with an additional $140 million contingent upon regulatory milestones and sales performance. The deal also comes with operational shifts for Spectrum, including a reduction in its workforce by nearly 40%. Most of the affected employees will be transferred to Acrotech, although Spectrum will retain a core team to oversee the launch of its remaining pipeline drugs.

For Aurobindo Pharma, the acquisition aligns with its strategy to expand into the branded oncology market. By acquiring these drugs, Aurobindo aims to build upon its existing infrastructure and solidify its position in the oncology space. The move also enhances its portfolio of proprietary treatments and opens new avenues for commercializing branded cancer medications.

Dr. Ashish Anvekar, President of Acrotech Biopharma, shared enthusiasm for the acquisition, highlighting the potential to impact cancer patients globally. He also welcomed the team of experienced employees from Spectrum, whose expertise will contribute to the mission of delivering differentiated oncology medications.

Both companies’ boards have approved the transaction, with the deal expected to close within 90 days, pending regulatory approvals.