(Bloomberg) -- Danish drugmaker Genmab A/S agreed to buy closely held US biotech firm ProfoundBio Inc. for $1.8 billion in cash, the latest in a flurry of deals to gain next-generation cancer antibodies.

The takeover will give Genmab experimental antibody drug conjugates, including one that’s in mid-stage clinical tests for ovarian cancer, the company said Wednesday. Both boards backed the transaction.

Genmab is expanding its presence in therapies that deliver cancer-killing agents directly to tumors while seeking to spare healthy tissue, a field led by large drugmakers like AstraZeneca Plc, Pfizer Inc. and Roche Holding AG. 

The search for these targeted medicines sparked a series of industry deals last year, including AbbVie Inc.’s $10 billion move for ImmunoGen Inc., which developed an antibody drug conjugate for ovarian cancer. 

Read More: AbbVie to Pay $10.1 Billion for Drugmaker ImmunoGen

Genmab sought new drug candidates following its success with the blockbuster Darzalex, which targets multiple myeloma, a blood cancer that develops in the bone marrow. The company partnered with Johnson & Johnson on the treatment. 

“The market has been concerned about what will happen when the Darzalex royalty payment cash flows disappear in some years,” Soren Lontoft Hansen, an analyst at Sydbank, said by phone. “This acquisition will help address some of those concerns.”

Genmab shares fell as much as 1.1% in Copenhagen trading, reversing earlier gains. The stock has dropped about 19% in the past 12 months. 

The deal is a positive but the price is “daunting,” Suzanne van Voorthuizen, an analyst at Van Lanschot Kempen, wrote in a note to clients. 

ProfoundBio’s backers include OrbiMed Advisors LLC and Janus Henderson Group Plc. The Seattle-based biotech just raised $112 million in a February financing round. 

Genmab plans to broaden the development plans for ProfoundBio’s Rina-S treatment for ovarian cancer as well as other solid tumors that express a protein called folate receptor alpha, or FRα. The deal is expected to close in the first half, it said.

--With assistance from Phil Serafino and Alexandra Muller.

(Updates with analyst comment in eighth paragraph, ProfoundBio backers in ninth)

©2024 Bloomberg L.P.