Amgen has thrashed out an all-cash deal to buy cancer specialist Onyx for $10.4 billion which should close in the fourth quarter.

The $125-per-share transaction is an increase on an earlier offer of $120-a-share that was turned down by Onyx's board in June, and comes after weeks of negotiations and due diligence on the prospects for the company's product portfolio.

The biggest draw for Amgen - and the subject of much of the due diligence - was Onyx' Kyprolis (carfilzomib), a treatment for multiple myeloma that debuted in the US last year. Attention was focused on the product in the build-up to the deal being struck as it emerged that the fine offer would be contingent on its prospects, particularly outside the US.

Amgen chief executive Robert Bradway told investors yesterday that he was satisfied that Kyprolis has a best-in-class profile among proteasome inhibitors for multiple myeloma and has significant potential for growth.

The drug was cleared by the FDA for patients who have already been treated with at least two other multiple myeloma drugs, but "we see great potential for Kyprolis in earlier lines of multiple myeloma," said Bradway.

Ahead of the deal there were reports that Amgen was trying to get access to data from ongoing trials to gauge the chances of securing approval outsider the US.  Bradway reassured investors that the company had worked closely with international experts in myeloma and is "excited about the potential of this product internationally".

With expected peak sales in excess of $1 billion Kyprolis underpins the takeover as it is the only marketed product to which Onyx holds exclusive rights, although the company also has two other products sold by Bayer.

Nexavar (sorafenib) for liver and kidney cancer and Stivarga (regorafenib) for colorectal cancer and a form of stomach cancer generate royalty revenues for Onyx of up to 20 per cent of sales, and are also being developed for a string of other tumour types.  

Meanwhile, Onyx has a partnership with Pfizer on another drug - called palbociclib - that is in phase III trials for breast cancer, and also has a multiple myeloma follow-up called oprozomib in Phase I/II trials.

Bradway insisted on a conference call that these will be important contributors to future revenues and earnings and there are no plans to amend existing partnerships.