Sun Pharma to acquire oncology therapy company Checkpoint in US
11 Mar 2025
Sun Pharmaceutical Industries Ltd has entered into an agreement to acquire US-based immunotherapy and targeted oncology company, Checkpoint Therapeutics Inc, a development that would bring the only FDA-approved anti-PD-L1 treatment for metastatic or locally advanced cutaneous squamous cell carcinoma (cSCC) to Sun Pharma's global onco-derm portfolio.
While finer details of the deal are yet to be disclosed, the transaction involves an upfront cash payment of $4.10 per share, or an aggregate consideration of up to $355 million. Shareholders of Checkpoint will also receive a contingent payment of up to $0.70 per share on achievement of certain milestone.
Waltham, Massachusets-based Checkpoint is a Nasdaq-listed company engaged in the development of novel treatments for solid tumor cancers. The company has received approval from the US Food & Drug Administration (FDA) for `Unloxcyt’ (cosibelimab-ipdl) for treatment of untreated metastatic cutaneous squamous cell carcinoma (cSCC) or locally advanced cSCC in adults.
Checkpoint has been burdened with rising expenses and little cash balance to meet R&D and other expenses. For the nine months ended September 2024, Checkpoint reported $0.04 million in revenue and a net loss of $27.3 million. During the period, the company spent $19.3 million on R&D and had a cash balance of $4.7 million. The company had also accrued and outstanding payable accounts of $15.6 million and related party outstanding of $2 million.
Dilip Shanghvi, chairman and managing director of Sun Pharma, said the acquisition of Checkpoint will bolster Sun Pharma’s onco-derm therapy portfolio, offering yet another treatment option for patients with cSCC.
Under the deal, Sun Pharma will acquire all outstanding shares of Checkpoint and Checkpoint stockholders will receive $4.10 per each share of common stock as upfront cash payment and a non-transferable contingent entitlement for an additional $0.70 in cash, on approval of cosibelimab in the European Union and the United Kingdom, subject to the terms and conditions.
The upfront cash payment of $4.10 per share represents a 66 per cent premium to Checkpoint's closing share price on 7 March 2025, the last trading day prior to the announcement.
Accordingly, Checkpoint, Sun Pharma and Fortress Biotech Inc, which holds controlling stake in Checkpoint, have entered into a royalty agreement, under which Fortress will be entitled to royalty payments based on future sales of cosibelimab during a specified term.
A special committee of independent directors appointed by Checkpoint’s board of directors conducted a comprehensive review of potential strategic alternatives available to Checkpoint and ultimately recommended the deal with Sun Pharma.
The transaction is expected to be completed in the second quarter of 2025. The transaction, which is subject to customary closing conditions, including regulatory and shareholder approvals, is expected to be completed in the second quarter of 2025.
