Ariad Pharmaceuticals Inc. on Monday accepted a $5.2 billion takeover offer from Japan’s Takeda Pharmaceuticals Inc., making the Cambridge company the latest Massachusetts biotech to be gobbled up by a global drug company seeking to strengthen its product line.
The 26-year-old Ariad has a blood cancer drug on the market and is seeking US approval for a lung cancer treatment. Takeda, which gained a foothold in Massachusetts in 2008 when it paid $8.8 billion for Millennium Pharmaceuticals Inc., runs a research center at the former Millennium site in Cambridge, now headquarters for Takeda’s global cancer drug business.
The takeover of Ariad will broaden the Japanese company’s portfolio of hematology drugs.
“This builds on our US presence and our Boston research and development presence,” Takeda chief medical and scientific officer Andy Plump said in an interview. He said Takeda sells a half dozen cancer drugs globally, but has rights to only two in the United States — including the multiple myeloma drug Velcade, which it acquired in the Millennium deal.
For Ariad shareholders, the Takeda purchase provides a profitable exit that not long ago might have seemed unlikely. Ariad’s stock plunged after its chronic myeloid leukemia drug, Iclusig, was temporarily pulled from the market in 2013 over safety concerns. Ariad shares on Monday jumped 73 percent to $23.75, up $10.01 on the Nasdaq exchange.
But the Takeda buyout — which requires approval by federal regulators — also means Massachusetts will lose yet another an independent company that once aspired to become an anchor of a cluster of cancer drug makers based in the state. It was the biggest takeover of a Massachusetts biotech since Connecticut’s Alexion Pharmaceuticals Inc. paid $8.4 billion for Lexington-based Synageva BioPharma Corp. in 2015.
The Ariad deal — announced during the J.P. Morgan Healthcare Conference in San Francisco — came a day after another Cambridge biotech, Merrimack Pharmaceuticals Inc., said it was selling its pancreatic cancer drug and other assets to Ipsen SA of France for $575 million upfront and up to $450 million more in potential milestone payments.
Takeda will not only obtain the rights to Iclusig, but it also gains Ariad’s experimental lung cancer drug, brigatinib. Ariad is expecting a ruling on brigatinib from the Food and Drug Administration some time in the coming months.
Assuming the drug is approved, the price Takeda decides to charge for it could put the Japanese company in the spotlight. Last fall, members of Congress, including Senator Bernie Sanders of Vermont, and Democratic Representative Elijah Cummings of Maryland, criticized Ariad for raising the price of Iclusig in 2016 to about $200,000 annually amid rising concern over drug costs.
The Ariad purchase is Takeda’s first major takeover of a Boston-area company since it bought Millennium. Takeda has kept a strong presence in Cambridge, where it has about 1,500 employees working on cancer drugs and vaccines. But along the way, several top local executives have left as Takeda has worked to blend the Massachusetts culture into that of the corporate parent.
Christophe Bianchi, president of Takeda’s global oncology business, said executives are still figuring out how they will integrate Ariad with Takeda. They’ll meet with their Ariad counterparts over the next few weeks, he said.
Among the issues still to be resolved, Bianchi said, is how many of Ariad’s roughly 300 employees will join Takeda and how to use the new space Ariad has leased on Binney Street in Kendall Square, where most of its US employees moved late last year.
“Our plans about space, about employees are still being worked on,” Bianchi said. “We need to digest this acquisition, make it work.”
In a joint statement, the companies said Takeda would pay $24 a share for Ariad, a 75 percent premium to its Friday closing stock price. The statement said the deal has been approved by both boards. It’s expected to close by the end of February.
Some industry analysts said that, because the purchase is structured as a tender offer, it was possible rival bidders for Ariad could still emerge.
The 75 percent premium “highlights the scarcity value” of companies with cancer drugs on the market or nearing approval, Michael Schmidt, a biotech analyst at Boston health care investment bank Leerink Partners, wrote in a note to investors Monday.
Takeda research chief Plump said he was impressed with the quality of science at Ariad. “There’s very few companies that launch two cancer drugs out of their own labs, as Ariad has done,” he said. “These drugs are very complementary to our portfolio.”
Ariad executives didn’t respond to requests to discuss the deal. In a statement, chief executive Paris Panayiotopoulos said he viewed the takeover as “uniting shared cultures of passion for patients and R&D.”
Alex Denner, the Ariad board chairman, said the acquisition “is a great outcome for shareholders.” Denner, a protege of activist investor Carl Ichan, is the founder of Sarissa Capital Management, a hedge fund that holds 6.6 percent of Ariad’s stock.
Sarissa began accumulating Ariad shares in late 2015 after safety concerns forced the company to temporarily pull Iclusig from the US market. With the sale, the value of Sarissa’s initial $43.6 million investment will have increased at least fivefold.
The hedge fund successfully pushed for the ouster of the company’s founder and chief executive, Harvey Berger, just over a year ago. Denner then became Ariad’s chairman, hired Panayiotopoulis as chief executive, and initiated a “strategic review” of Ariad’s business.
The review resulted in 90 job cuts last year, and the sale of Ariad’s 125-person European operation in Lausanne, Switzerland, along with European rights to Iclusig. Ariad also accepted the resignation of four veteran board members who served under Berger.
Berger, in an interview, said he was proud of the work he did over a quarter century to build the company and develop Iclusig and brigatinib, along with three other experimental cancer drugs he said held promise. As a shareholder, Berger said, he would profit from the takeover, but he said he was most focused on how Ariad helped cancer patients.
“Ariad has been extraordinarily effective and productive,” Berger said. “I’m very proud of what we were able to do during the years I was there to make a difference for patients.”
Sarissa, he added, was “able to take advantage of an opportunity. They piggybacked on the accomplishments we devoted our whole [lives] to.”