(Bloomberg) -- As pharma giants spend billions on acquisitions of startups developing new ways to harness radiation in the fight against cancer, the chief executive officer of Perspective Therapeutics Inc. found himself getting top billing at two different industry gatherings this week.

The Seattle-based firm has seen its value roughly quadruple to $833 million this year, swept up in the radiopharmaceuticals frenzy. No wonder CEO Thijs Spoor was being sought out by investors at the events, one of which praised nuclear medicine’s disruptive potential.  

“There’s been a big pickup in institutional interest,” Spoor said in an interview.

Eli Lilly & Co., Bristol-Myers Squibb Co. and AstraZeneca Plc have spent almost $8 billion combined to scoop up companies developing radiopharmaceuticals like RayzeBio in the past six months. Regulatory filings show there were multiple bidders for at least two of the deals. 

These therapies hold the promise of destroying tumors while leaving healthy cells relatively unscathed. Instead of delivering the radiation from outside the body, the drugs can be injected and travel directly to the tumor, minimizing damage to other tissue. 

Morgan Stanley estimates that the radiopharmaceutical market will grow to $39 billion by 2032 from about $7 billion in 2022.

One such medicine has already reached pharmacy shelves. Developed by Novartis AG, Pluvicto is approved for certain types of prostate cancer and has shown it can help some patients live longer without the disease worsening. The treatment garnered sales of $980 million last year — its first full year on the market — and Novartis expects it to become a multi-billion dollar blockbuster. 

These medicines are backed up by “very meaningful” scientific data and there’s room for others besides Pluvicto to become standards of care, Andrew Tsai, an analyst at Jefferies, said in an interview. 

Research is speeding ahead, with RayzeBio enrolling patients in an advanced clinical trial for tumors growing in the gut or pancreas. Another medicine under development by closely held RadioMedix won a breakthrough therapy designation from US regulators in February. 

Rising Tide

Lilly kindled interest when it entered the field last October with a deal to buy Point Biopharma, which is developing an anti-tumor therapy for prostate cancer that would compete with Pluvicto.  

Since then, Clarity Pharmaceuticals Ltd., a developer of next-generation therapy and imaging products based in Australia, has jumped 136% and Actinium Pharmaceuticals Inc., whose lead product showed promise in older patients with a form of leukemia, has gained 58%. Private companies including Abdera Therapeutics, Mariana Oncology and OncoInvent are also in focus. 

Perspective Therapeutics, for its part, is advancing the development of drugs that it hopes will treat conditions such as melanoma. The company is fielding more calls from pharmaceutical companies lately, according to CEO Spoor. “A lot of them are saying we’d love to learn more and they’re trying to get up the learning curve,” he said.

Perspective’s shares traded 2% lower on Friday.

One challenge for the wider sector is production. The radioactive isotope can be produced in a nuclear reactor, with a limited number of providers. Stringent regulatory requirements around manufacturing further limit companies’ options. And when the products are made, they need to get to patients in a matter of days. 

That’s why a key aspect of AstraZeneca’s agreement to purchase Fusion Pharmaceuticals Inc. was gaining access to the target’s manufacturing and supply-chain capabilities. Fusion already has access to the radioactive metal actinium through agreements with key suppliers, Susan Galbraith, Astra’s executive vice president of oncology R&D, said in an interview at the time of the deal. 

Access to manufacturing was key to all three recent deals, according to Jefferies’ Tsai. The first two also sparked bidding wars, underscoring the radiopharma field’s growing attraction.

Many Bidders

Lilly wasn’t the only contender for Point Biopharma. Regulatory filings show that Point’s board believed another six companies might be interested in bidding. One submitted an offer for Point and raised it before Lilly’s proposal finally won out.

Two months later, Bristol-Myers was up against two rival bidders for RayzeBio, with both offering premiums of more 40%. Bristol-Myers succeeded with a final offer that was worth more than double the target’s share price.

Some analysts warn that despite the hype, the scale of the deals is still relatively small and the potential income from certain products unclear. In the case of Astra and Fusion, “future revenues may be still some way off, if they arrive at all,” said Susannah Streeter, head of money and markets at Hargreaves Lansdown. 

Spoor, meantime, expects a shift in the kind of deals being clinched. 

“Some of the early acquisitions appear to be more infrastructure-focused,” he said. In the future, the targets may be companies with “strong patent-protected novel mechanism-of-action assets.” 

--With assistance from Michelle F. Davis and Lisa Pham.

(Updates with shares. An earlier version was corrected to include company’s updated headquarters location in second paragraph.)

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