Amgen Shares Climb on $840 Million Leukemia Drug Bet
The acquisition of Dark Blue Therapeutics adds a promising preclinical asset to Amgen's oncology pipeline, signaling a deeper push into targeted cancer therapies.
Amgen Inc. (NASDAQ: AMGN) shares rose sharply on Wednesday after the biotechnology giant announced a deal to acquire Dark Blue Therapeutics, a private UK-based firm, for up to $840 million. The move strengthens Amgen's position in the highly competitive oncology market by adding a promising, first-in-class program for treating acute leukemia.
Investors reacted positively to the strategic acquisition, sending Amgen's stock up 2.95% to close at $339.91 in midday trading, making it one of the day's more significant market movers. The deal underscores Amgen's strategy of acquiring early-stage assets to fortify its long-term drug pipeline as it prepares for future patent expirations on some of its blockbuster treatments.
A Strategic Push into Targeted Therapies
The acquisition centers on Dark Blue's lead program, a preclinical small-molecule degrader known as DBT-3757. This therapy utilizes a cutting-edge approach called targeted protein degradation to go after MLLT1/3, proteins known to drive aggressive forms of Acute Myeloid Leukemia (AML) and Acute Lymphoblastic Leukemia (ALL). Unlike traditional drugs that may only inhibit cancer-causing proteins, protein degraders are designed to eliminate them entirely, offering a potentially more potent and durable response.
This investment aligns with Amgen's broader focus on building out its oncology portfolio, which remains a cornerstone of its growth strategy. The company, with a market capitalization of over $172 billion, has been actively seeking external innovation to complement its internal research and development efforts. The deal for Dark Blue, an Oxford University spin-out, brings not only a lead drug candidate but also its 18-person scientific team, who will be integrated into Amgen's global R&D operations, according to reports on the acquisition.
Market Position and Analyst Outlook
The stock's advance places it near its 52-week high of $346.38, reflecting sustained investor confidence. Over the past six months, Amgen has delivered a strong 17.6% return, outpacing the broader S&P 500. While the acquisition represents a long-term bet on preclinical science, it addresses a critical need to refresh the company's pipeline.
Wall Street analysts maintain a cautiously optimistic consensus on Amgen. Prior to the announcement, the company held a "Moderate Buy" consensus rating, based on 14 buy and 15 hold ratings. The average analyst price target sits at approximately $327, suggesting that many on Wall Street see the stock as fairly valued, though Wednesday's rally has pushed the price above that level.
Looking Ahead in a Competitive Landscape
For Amgen, the acquisition of Dark Blue is a calculated investment in the future of its cancer franchise. While DBT-3757 is still in the final stages of preclinical testing and years away from potential commercialization, its novel mechanism could position it as a key therapy in hematologic malignancies if successful.
The deal structure, with an upfront payment and future milestone payments totaling up to $840 million, allows Amgen to mitigate risk while securing a potentially transformative asset. As the biopharmaceutical landscape evolves, with increasing competition and pressure on drug pricing, strategic bolt-on acquisitions like this are becoming crucial for large-cap players like Amgen to maintain their innovative edge and drive future growth.