Concentra Biosciences Acquires iTeos Therapeutics in Latest Biotech Buyout

Concentra Biosciences, a company known for acquiring struggling biotechs, has announced its latest acquisition target: iTeos Therapeutics. The deal, valued at $10.047 per share with additional contingent value rights, comes just months after iTeos faced a significant setback in its TIGIT antibody program.

iTeos Therapeutics: From TIGIT Failure to Acquisition Target

iTeos Therapeutics, a Belgium-based biotech, recently decided to wind down operations following disappointing results from its anti-TIGIT antibody belrestotug. The antibody, developed in partnership with GSK, failed to meet clinical expectations in mid-stage studies for non-small cell lung cancer and head and neck cancer. This setback led to GSK abandoning the partnership in May, leaving iTeos in a precarious position.

Michel Detheux, CEO of iTeos, stated at the time, "The disappointing outcomes in our mid-stage studies have forced us to reevaluate our strategic direction. Our primary focus now is on maximizing value for our shareholders."

Concentra's Acquisition Strategy and Deal Terms

Concentra Biosciences, backed by Tang Capital and led by Kevin Tang, has offered $10.047 for each outstanding share of iTeos common stock. This price represents a slight discount to iTeos' closing price of $10.26 on the Friday before the announcement. The deal also includes a contingent value right (CVR) that entitles shareholders to:

1. Any excess of iTeos' net cash over $475 million
2. 80% of net proceeds from any sale of product candidates within six months of the acquisition

The board of directors at iTeos has unanimously approved the agreement, deeming it "in the best interests of all iTeos stockholders." Concentra plans to commence its tender offer by August 1, with the transaction expected to close in the third quarter of 2025.

Implications for the Biotech Industry

This acquisition is the latest in a series of moves by Concentra to purchase struggling biotech companies. Earlier this month, Concentra acquired cell therapy specialist Cargo Therapeutics for $202 million upfront, plus a CVR offer. The company has also recently purchased IGM Biosciences, Kronos Bio, and Elevation Oncology.

Industry analyst Sarah Johnson commented, "Concentra's strategy of acquiring biotechs facing challenges is reshaping the landscape of the industry. It's providing an exit strategy for companies that might otherwise face closure, but it's also consolidating assets under a single umbrella."

The iTeos acquisition highlights the ongoing challenges in the TIGIT space and the broader difficulties faced by biotech companies in bringing novel therapies to market. It also underscores the importance of contingency planning and strategic partnerships in the volatile world of drug development.