Gilead exercises option to buy Corus for $365M

Gilead Sciences has agreed to exercise its option to purchase fellow USA-based firm Corus Pharma for $365.0 million. Gilead expects formal exercise of this option to be enacted within 10 business days, and anticipates that the deal will close in the third quarter of the year, subject to clearance under the Hart-Scott-Rodino Antitrust regulations and other customary closing conditions.

In separate news, Gilead and Novartis Vaccine and Diagnostics have entered into an agreement whereby the Swiss drug major will dismiss its ongoing litigation with privately-held Corus for an undisclosed payment. The market reacted positively to Gilead's aquisition. On the day of the two announcements, shares in Gilead rose $0.98 on the Nasdaq to close at $61.23.

Earlier this year, Gilead invested $25.0 million in Corus, becoming its second largest shareholder and gaining an exclusive option to purchase the company's remaining shares (Marketletter April 24). Gilead says its management will discuss this planned acquisition at its second-quarter 2006 earnings conference call.