Johnson & Johnson to Buy Aragon Pharmaceuticals for $650 Million Up Front

The board of privately held Aragon Pharmaeuticals, a firm that concentrates on the development of hormonally based cancer treatments, has agreed to be acquired by Johnson & Johnson (NYSE: JNJ  ) for an upfront cash payment of $650 million, Johnson & Johnson and Aragon Pharma announced today.

If certain milestones are met, Johnson & Johnson will make additional payments up to $350 million to Aragon Pharma. The acquisition of Aragon Pharma includes its androgen receptor antagonist program targeting the treatment of prostate cancer, including its primary product candidate in phase 2 development, ARN-509. Prior to Johnson & Johnson's assuming ownership of Aragon and its androgen receptor antagonist treatments, Aragon Pharma will spin off all its other assets into a separate entity called Seragon Pharmaceuticals. Johnson & Johnson will have no ownership stake in Seragon Pharma, nor hold any rights to its products or technologies, Aragon said.

Dr. Peter Lebowitz, global therapeutic area head, oncology, for Janssen Research & Development (a Johnson & Johnson company), was quoted as saying, "The acquisition of Aragon further enhances our leadership in prostate cancer drug development. ARN-509 complements Zytiga and provides the potential for exciting, novel approaches to treat prostate cancer patients."

The transaction is expected to close in the third quarter of 2013, and is subject to regulatory and closing conditions including antitrust clearance.

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