US-based pharmaceutical company Johnson & Johnson (J&J) has agreed to acquire biotechnology company Ambrx Biopharma (Ambrx) for a total equity value of around $2bn cash loans today.

Under the terms of the acquisition, J&J will purchase all the outstanding shares of Ambrx’s common stock at $28 per share in cash, merging Ambrx with its subsidiary.

The transaction is expected to be completed in the first half of 2024, subject to receipt of Ambrx shareholder approval, along with the HSR Act and other customary closing conditions.

Upon closing of the transaction, Ambrx’s common stock will be de-listed on the NASDAQ.

J&J said the acquisition will provide a distinct opportunity to design, develop and commercialise the targeted oncology therapeutics.

Johnson & Johnson innovative medicine oncology global therapeutic area head Yusri Elsayed said: “Ambrx’s ADC technology offers unique advantages in the conjugation of stable antibodies and cytotoxic linker payloads, which results in engineered ADCs that effectively kill cancer cells and limit toxicities.

“The results seen to date with ARX517 in mCRPC are promising and represent a potential first- and best-in-class targeted therapy for the treatment of this aggressive disease.

“In addition, Ambrx’s pipeline and ADC platform present exciting future opportunities to deliver enhanced, precision biologics as we look to transform the treatment of cancer and improve patients’ lives.”

Established in 2003, Ambrx expanded the genetic code technology platform for the incorporation of synthetic amino acids (SAA) into proteins at any selected site.

The SAAs allow engineered precision biologics with site-specific, homogenous, and stable conjugation to address the limitations of traditional conjugation technologies.

Ambrx has a unique synthetic biology technology platform that enables the designing and development of next-generation antibody-drug conjugates (ADCs).

The company is developing a portfolio of clinical and preclinical programs to optimise the efficacy and safety of its candidate therapeutics in multiple cancer indications.

The portfolio includes ARX517, which targets prostate-specific membrane antigen (PSMA) for metastatic castration-resistant prostate cancer (mCRPC).

It also constitutes ARX788, which targets human epidermal growth factor receptor 2 (HER2) for metastatic HER2+ breast cancer and ARX305 targeting CD-70 for renal cell carcinoma.

J&J said that its scientists will work together with Ambrx researchers to advance the Phase 1/2 APEX-01 study of ARX517 in advanced prostate cancer, along with other ADC candidates.

Ambrx CEO Daniel O’Connor said: “With our deep and unique knowledge of precision engineering of protein therapeutics enabled by our proprietary technology incorporating synthetic amino acids in living cells, Ambrx has developed next-generation novel drug candidates such as site-specifically conjugated highly stable antibody-drug conjugates.

“Through this transaction, we will continue to advance our leading prostate cancer candidate and Ambrx’s promising pipeline, while delivering significant and certain cash value to our shareholders.

“This announcement is the culmination of two decades of scientific work, combined with the Ambrx team’s talent, hard work and innovation. I look forward to what Ambrx will achieve as part of Johnson & Johnson.”