HOLBAEK, Denmark - Pharmacosmos A/S, a Danish pharmaceutical company specializing in iron deficiency treatments, has advanced in its acquisition of G1 Therapeutics (NASDAQ:GTHX), Inc., a commercial-stage oncology company. The mandatory waiting period under the Hart-Scott-Rodino Antitrust Improvements Act expired on Monday, marking a significant step towards finalizing the merger first announced on August 7, 2024.
Under the terms of the agreement, Pharmacosmos, through its U.S. subsidiary, will acquire all outstanding shares of G1 Therapeutics common stock for $7.15 per share in cash. This transaction values G1 Therapeutics at approximately $405 million, which is a 68% premium over its closing share price on the day before the announcement and a 133% premium on the 30-day volume weighted average price.
The conclusion of the HSR Act waiting period satisfies a crucial condition for the tender offer, which is still subject to other customary closing conditions. These include the tender of shares representing at least a majority of G1's outstanding common stock. The offer is set to expire just after midnight on September 17, 2024, unless extended.
Pharmacosmos A/S, established in 1965 and headquartered in Holbaek, Denmark, has a strong focus on research and development, leveraging its expertise in carbohydrate chemistry to innovate treatments for iron deficiency and iron deficiency anemia. The company has a global reach with operations in various countries and a workforce exceeding 500 employees.
G1 Therapeutics, based in Research Triangle Park, N.C., is dedicated to developing next-generation therapies for cancer patients, including its commercial product COSELA® (trilaciclib). The company aims to offer therapeutic advances for individuals living with cancer.
The acquisition is a strategic move for Pharmacosmos, expanding its portfolio into the oncology space and building on its existing capabilities in treatment development. This merger is expected to close following the satisfaction of the remaining conditions, including the successful tender offer.
The information provided in this article is based on a press release statement.
In other recent news, G1 Therapeutics has been the focus of multiple significant developments. The Danish pharmaceutical company, Pharmacosmos, announced a definitive agreement to acquire G1 Therapeutics for approximately $405 million. This strategic merger aims to extend the reach of COSELA, G1's FDA-approved drug for reducing chemotherapy-induced myelosuppression in patients with extensive stage small cell lung cancer.
On the financial front, G1 Therapeutics reported a 34% increase in net sales year-over-year and a 4% increase in vial volume growth for COSELA in their first-quarter earnings call for 2024. The company maintains a revenue guidance of $60 million to $70 million for the year.
In the realm of analyst perspectives, Needham revised its price target for G1 Therapeutics following the announcement that the combination treatment of Trilaciclib did not show a significant overall survival benefit. Similarly, H.C. Wainwright adjusted its outlook on G1 Therapeutics, reducing the price target on the stock, while still maintaining a Buy rating.
In terms of clinical trials, the company's Phase 3 PRESERVE 2 trial of Cosela in triple-negative breast cancer did not meet its primary endpoint. Despite this, positive results were reported from a Phase 2 clinical trial for Trilaciclib in combination with a TROP2 ADC.
Lastly, G1 Therapeutics secured a licensing deal with Pepper Bio, potentially bringing in up to $135 million in payments. These developments have led to strategic realignments within the company, with a renewed focus on expanding its extensive-stage small cell lung cancer business and exploring other applications for Trilaciclib.
InvestingPro Insights
In light of Pharmacosmos A/S's ongoing acquisition of G1 Therapeutics, Inc., recent data from InvestingPro offers valuable insights into the financial health and market performance of the oncology company. G1 Therapeutics, known by its ticker GTHX, has demonstrated an impressive gross profit margin of 89.44% in the last twelve months as of Q2 2024. This metric underscores the company's strong ability to control costs relative to revenue, a key factor that may have influenced Pharmacosmos's decision to pursue the acquisition.
Furthermore, G1 Therapeutics has shown a strong return on investment with a one-year price total return of 319.41%, reflecting significant investor confidence and market momentum. This aligns with the premium that Pharmacosmos is willing to pay for the company, as indicated by the 68% premium over the closing share price before the announcement of the acquisition. Such a premium is also justified by G1's recent stock performance, which includes a 133.77% year-to-date price total return as of 2024.
An InvestingPro Tip highlights that G1 Therapeutics' stock price movements have been quite volatile, which may present both opportunities and risks for investors. This volatility is evident in the substantial price total returns over various periods, including an 80.51% return over the last month and a 122.12% return over the last three months. Despite this, the company is trading near its 52-week high, with a price 99.17% of the 52-week high, suggesting that the market is responding positively to the acquisition news and the company's prospects.
For readers looking to delve deeper into G1 Therapeutics' financials and market standing, InvestingPro offers a comprehensive list of additional tips and metrics. To explore further, visit https://www.investing.com/pro/GTHX for more InvestingPro Tips and real-time data.
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