Antisoma is buying the USA’s Xanthus Pharmaceuticals in an all–share agreement worth £26.8 million that the UK firm says is “a transforming deal”.

The acquisition of Xanthus “adds three major assets” to its pipeline, said Antisoma, notably xanafide, which is in Phase III trials for secondary acute myeloid leukaemia. The company intends to market xanafide itself in the USA, while seeking partners for potential commercialisation in Europe and Japan.

Antisoma is also getting hold of the US rights to oral fludarabine. The latter is marketed outside the USA as Fludara by Bayer and has been submitted to the Food and Drug Administration for the second-line treatment of chronic lymphocytic leukaemia. The London-headquartered firm says it may sell the drug, which could gain approval in 2009, by itself, set up a partnership or even divest it.

The other asset involves Xanthus’ preclinical selective Flt3 inhibitors being developed for non-oncology indications which represent “a valuable out-licensing opportunity”. Drugs from this programme have shown regenerative effects in multiple sclerosis and activity in rheumatoid arthritis and inflammatory bowel disease, the firms claimed. Development will be halted on two other Xanthus products in early-stage oncology trials, Clomet and Symadex.

Antisoma chief executive Glyn Edwards said the purchase is “a transforming deal” as the combination “produces a company with the critical mass and mature pipeline needed to become a major player in oncology.” His counterpart at Xanthus, Richard Dean, described Antisoma as “one of the emerging stars in oncology” which has “an impressive portfolio of drug candidates and the resources to maximise their value”.

Analysts are impressed as the products purchased enhance the maturity of the pipeline and reduce Antisoma's reliance on ASA404, the lung cancer compound that partner Novartis has just put into Phase III trials, a move which triggered a $25 million payment to the UK firm. The licensing potential of the Xanthus assets also means that Antisoma could be able to add to its already healthy cash pile.

That cash pile has been just been boosted as Antisoma announced that it has executed a fundraising that will provide an additional £20.9 million before expenses to the enlarged group. This means that its balance sheet now shows starting cash of around £67 million that will meet its requirements for the next two years.