Drug giant to acquire Waltham biotech

Bristol-Myers Squibb Co., the pharmaceuticals giant that is building a $750 million biotech manufacturing plant on the site of the former Fort Devens US Army base, is aiming to become a major biotech research force in the state, as well.

The New Jersey company yesterday said it will buy Adnexus Therapeutics Inc., a promising Waltham biotechnology company, for $430 million - plus up to $75 million in additional conditional payments - giving Bristol-Myers Squibb its first drug-discovery operations in Massachusetts.

The company said both the plant and the Adnexus acquisition are part of its broader strategy of investing in biologic drugs, which are obtained from living organisms instead of by mixing chemicals in a lab.

"We feel biologics will be a cornerstone of our future growth," said Dr. Francis Cuss, a senior vice president in research at Bristol-Myers Squibb.

The deal also enhances the drug maker's presence in Massachusetts - one of the world's biggest biotech hubs - where Bristol-Myers said it plans to continue scouting for acquisitions and talented employees in the biotech field.

"The Boston area has some very robust biologics companies and some wonderfully trained people," Cuss said. "We certainly will be looking here and elsewhere to execute our strategy."

Several other global pharmaceutical companies have already developed major biotech research centers in the state. Wyeth, for instance, has 1,900 employees in Andover and 700 in Cambridge. Shire PLC, the British drug maker, has roughly 600 employees in Cambridge and is working on an expansion project in Lexington. And Swiss drug maker Novartis AG recently said it will boost its head count in Cambridge to 1,550 by next year.

Cuss said Adnexus will remain in Waltham, where it will become a subsidiary of Bristol-Myers Squibb and its key "discovery engine" for biological compounds. Adnexus has about 55 employees, most of whom work in research.

Adnexus, founded five years ago, is still a long way from winning approval for its first drug. The company is in early clinical trials for a cancer treatment called Angiocept, which is designed to keep tumors from growing by blocking the formation of new blood vessels. But Cuss said the company has a talented cadre of scientists and a powerful platform for discovering new therapies, for cancer and other afflictions.

Even before yesterday's news, Bristol-Myers Squibb and Adnexus had been collaborating on cancer research.

In February, Bristol-Myers Squibb entered into a partnership with Adnexus, agreeing to pay it $20 million and to fund further research over the next three years. Adnexus's chief executive, John Mendlein, said the companies have also talked about ways to expand the arrangement.

Last month, Adnexus filed papers to become a publicly traded company, a move made moot by the Bristol-Myers Squibb purchase.

Adnexus had previously raised $76 million from key investors, including Flagship Ventures, Atlas Ventures, Polaris Venture Partners, Venrock Associates, and HBM Bioventures Ltd. Those investors now own about 85 percent of the company, worth roughly $366 million based on the $430 million purchase price. In addition, Bristol-Myers Squibb agreed to pony up another $75 million in three increments if Adnexus meets certain development and regulatory milestones.

Bristol-Myers Squibb had gradually become an important player in the region's life sciences industry. In February, it began construction on its new drug plant at Devens, which is expected to have 350 jobs when it opens in two years and eventually could employ as many as 550.

The drug maker also has about 400 employees in its medical imaging division in Billerica.

Todd Wallack can be reached at twallack@globe.com.