NJ firm agrees to buy Targanta

Struggling Cambridge biotech Targanta Therapeutics Corp. is being bought for about $42 million by the Medicines Co., a New Jersey drug company.

The proposed sale comes after Targanta's lead drug candidate narrowly failed to win a recommendation from a federal advisory panel in November, and the company's stock price plummeted. (To read that story, please click here.)

The drug, oritavancin, is an antibiotic intended to treat complex skin infections, but panelists said it has not yet been proven safe and effective. Last month, the company said it was laying off 86 employees, about 75 percent of its workforce.

Still, the Medicines Co. appears optimistic that oritavancin will eventually win Food and Drug Administration approval. In a press release, Medicines Co. chief executive Clive Meanwell said, "Oritavancin has the potential to provide important patient outcome and economic advantages for hospitals."

The Medicines Co. also said that Targanta shareholders may be entitled to receive additional cash payments if certain milestones for oritavancin are met.

In a note to investors, Joel Sendek, a senior analyst at Lazard Capital Markets, said the sale makes sense "in light of Targanta's financial needs, economic environment, and lack of near-term catalysts." He predicted that oritavancin could be approved for use in the United States by 2012.
(By Chris Reidy, Globe staff)