A London-headquartered biotechnology company focused on the development of cancer drugs will enlarge its offering with the agreed acquisition of a US oncology company.

The all-share purchase of Massachusetts-based Xanthus Pharmaceuticals by Antisoma plc is valued at £26.8 million ($52.2 million) and represents the issue of a 22 per cent stake. The transaction is expected close at the beginning of June.

Antisoma’s pipeline will grow by three assets, resulting from the addition of Zanthus’ operations, including phase III oncology drug Xanafide and US rights to oral fludarabine, a niche oncology product in registration with the FDA.

Simultaneously, Antisoma has raised £20.9 million of funds, giving the enlarged business a strong balance sheet with starting cash of around £67 million.

Antisoma CEO Glyn Edwards says the “transforming” deal will produce a company with the critical mass and mature pipeline needed to become a major player in oncology.

Richard Dean, Xanthus CEO, adds: “We’re delighted to be joining forces with one of the emerging stars in oncology to produce a company with an impressive portfolio of drug candidates and the resources to maximise their value.”