Otsuka Pharmaceutical Group of Tokyo completed a $886-million merger with Astex Pharmaceuticals, Dublin, California, on October 11. Taro Iwamoto, Otsuka Pharmaceutical's president and representative director cited Pyramid, Astex's fragment-based drug discovery technology, as a driving factor for the acquisition. Although the fragment-based discovery platform is still unproven, eight of Astex's nine pipeline drugs were developed using the platform. The deal is a vote of confidence for the biotech's platform, says Brean Capital analyst Gene Mack in New York, adding that Otuska's primary aim was to shore up its own drug development capabilities. “Otsuka has said the Pyramid platform can be used to look into central nervous system diseases, an area that is more of a traditional strength,” says Robert McTiernan of IHS in Englewood, Colorado. Otsuka's portfolio contains the blockbuster schizophrenia drug Abilify (aripiprazole), with a patent expiring in 2015 in the US; marketing rights for two oncology drugs; and compounds under development for Alzheimer's and other disease areas. “Otsuka does seem to have some oncology compounds [under development], but mostly in phase 1, so the acquisition allows them to jump a few steps with minimum work,” McTiernan adds. Astex's most successful commercial product, in partnership with Tokyo-based Eisai and New Brunswick, New Jersey–based Johnson & Johnson, is the epigenome-targeted drug Dacogen (decitabine), approved in 2006 for treating myelodysplastic syndrome. Dacogen (not developed with the Pyramid technology) is a cytidine antimetabolite analog that is incorporated into DNA and inhibits DNA methyltransferase, resulting in hypomethylation and cell cycle arrest. Also promising is a small molecule follow-up agent to Dacogen—SGI-110. At the end of August, Astex announced early results from a phase 2 trial reporting a complete remission rate of 25% in elderly acute myeloid leukemia patients. Full trial results are expected in December 2013. Otsuka must be banking on the success of the phase 2 trial of SG-110, says Mack, but pointed out that the same investors who initially objected to the merger think Astex should have waited for the full trial results before agreeing to a sale price.