MELBOURNE: Telix Pharmaceuticals Limited (ASX: TLX), a company developing targeted radiopharmaceuticals for cancer diagnosis and therapy, announced today that it has agreed to acquire IsoTherapeutics Group, LLC, a Texas-based firm that specializes in radiochemistry and bioconjugation.

IsoTherapeutics, founded in 2005, is a commercial-stage company that offers development and contract manufacturing services to many players in the radiopharmaceutical industry, including Telix. The acquisition is expected to enhance Telix’s in-house drug development capabilities and enable it to bring select aspects of its development programs in-house, with the goal of reducing cost and time to achieve technical milestones.

The acquisition will also expand Telix’s U.S. manufacturing footprint with a site that includes a GMP clean room and production infrastructure suitable for clinical use. The site has extensive capacity to process a wide variety of therapeutic isotopes used in Telix’s development portfolio.

The acquisition is aligned with Telix’s vertical integration strategy and is expected to strengthen its ability to innovate and scale-up manufacturing, provide greater control over the isotope supply chain, and establish a centre of excellence in GMP bioconjugation and isotope processing.

IsoTherapeutics will continue to provide services to its existing customers and Telix’s strategic partners and collaborators after the acquisition. Telix expects to realise potential cost savings from bringing radiochemistry-related R&D activities in-house and expects the transaction to have a positive impact on its earnings.

Dr. Christian Behrenbruch, Managing Director and Group CEO of Telix, said, “With the agreement to acquire IsoTherapeutics I am pleased to welcome a team of highly recognised industry leaders in bioconjugation and radiochemistry to Telix, as well as further expand our manufacturing footprint in the U.S… This acquisition enhances our business with highly-sought-after skills, capabilities and facilities that are very much central to our development activities.”

The purchase price comprises US$8 million upfront, US$5 million in performance-related milestone payments, and a two-year revenue share based on actual revenue earned from existing customers of IsoTherapeutics. The upfront payment will be made in cash and shares, equating to approximately 823,481 shares. The milestone payments are subject to meeting conditions within twelve months of closing.