AustCancer snaps up US vaccine developer

Australian Cancer Technologies (AustCancer, ASX: ACU) is the latest Australian company to announce an acquisition of a US company, with its proposal to acquire US vaccine developer Galenica Pharmaceuticals for around US$5 million in shares.

The privately financed Galenica has developed proprietary technology in immune enhancers, carriers and antigens, which can be used as standalone therapeutics or as a vaccine component. The company has compounds being used in two Phase I and one Phase I/II clinical trial in US cancer centres, as well as licensing agreements with Pfizer Animal Health for a series of animal vaccines and with US company Endocyte for a novel immune therapy for kidney cancer.

Shareholders in the company include Pfizer Holdings Europe and SuperGen.

"We have been working aggressively on expanding our portfolio of developmental drugs. Galenica brings us exclusive rights to a novel technology with considerable potential and two products candidates already in the clinic. Galenica's patent estate includes five granted patents and one pending," said AustCancer CEO Paul Hopper in a statement. "Also, Galenica's technology platform is synergistic with what AustCancer is already doing -- immune enhancers are critically important in vaccines and the development of vaccines is one of our core businesses."

AustCancer's Pentrys cancer vaccine, currently in Phase IIb clinical trials as a treatment for prostate cancer, is likely to be evaluated for use with the Galenica adjuvants.

Galenica founder and CEO Dr Dante Marciani will join AustCancer and will continue to run the Alabama-based business.

Under the terms of the acquisition, AustCancer, through its wholly owned US subsidiary Adjuvantys, will issue almost 2 million shares at $0.48 and pay an additional US$350,000 upon closing. A further US$3 million will be paid in 12 months time, and $1 million after 24 months, in shares or cash at AustCancer's option. The acquisition is subject to due diligence by both parties and will be ratified by AustCancer shareholders at a general meeting in mid-July.

The acquisition is one of an increasing number of merger and acquisition activities between Australian and US companies. Earlier this week, Benitec announced that it would acquire Californian RNAi therapeutics company Avocel through the issue of 7.6 million shares, and last month AGT Biosciences announced its merger with Californian company ChemGenex Therapeutics in a deal worth AUD$14 million.