As part of a bid to re-establish its place at the top of the oncology tree, Bristol-Myers Squibb is paying $190 million to acquire Kosan Biosciences.

Under the terms of the deal, B-MS is paying $5.50 per share in cash for California-based Kosan, and trading in the latter’s stock was halted yesterday after shares more than tripled from its May 28 closing price of $1.65. The agreement contains a provision under which Kosan has agreed not to solicit any competing offers.

What B-MS will be getting for its money is compounds “in two important classes of anticancer agents”, namely novel Hsp90 (heat shock protein 90) inhibitors and epothilones. Kosan’s lead compound, KOS-953 (tanespimycin) is in a Phase III for multiple myeloma, in combination with Takeda’s Velcade (bortezomib), while last month it began Phase II studies of the epothilone KOS-1584 in patients with non-small cell lung cancer who have previously received only one prior chemotherapy regimen.

B-MS chief executive Jim Cornelius said that Kosan’s technology, “coupled with our development and commercialisation capabilities”, will result in new treatment options “and represents another important milestone in the execution of our strategy to become a next-generation biopharma leader”. His counterpart at Kosan, Helen Kim, said the firm has “reached a turning point in our growth as an independent company” and now is the time to place our clinical programmes and technology assets in the hands of a world-class company”.

Last October B-MS got approval for the epothilone Ixempra (ixabepilone) for advanced breast cancer, strengthening the firm’s oncology portfolio which includes Sprycel (dasatinib) and Erbitux (cetuximab). The company is also hoping to get approval soon for the investigational melanoma compound ipilimumab, which is partnered with Medarex.