Italian pharmaceutical and diagnostics company Menarini Group has signed a definitive agreement to acquire US-based Stemline Therapeutics for up to $677m.

Under the agreement, a wholly-owned subsidiary of Menarini will commence a tender offer for all outstanding shares of Stemline.

Stemline develops and commercialises oncology therapeutics. Its lead asset is Elzonris (tagraxofusp), designed to target interleukin-3 (IL-3) receptor-α (CD123).

The drug holds the US Food and Drug Administration (FDA) approval to treat patients aged two years and above with blastic plasmacytoid dendritic cell neoplasm (BPDCN). It is also being reviewed by the European Medicines Agency (EMA).

Menarini expects the drug to boost its portfolio and pipeline of cancer therapeutics.

Menarini Group CEO Elcin Barker Ergun said: “Stemline is an excellent fit for Menarini, enabling us to expand our presence in the US with an established biopharmaceutical company focused on developing oncology therapeutics.

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“Through this acquisition, we will continue to strengthen our portfolio and pipeline of oncology assets and deliver novel therapies around the world. We look forward to uniting together with the Stemline team to advance our shared mission of serving patients.”

Stemline will leverage Menarini’s infrastructure to develop Elzonris for additional indications across difficult to treat diseases and cancers.

The company could also benefit from Menarini’s expertise in launching products in Europe and emerging markets.

Stemline Therapeutics chairman, CEO and founder Ivan Bergstein said: “We are excited to be combining with a like-minded organisation in Menarini, in a transaction that will deliver immediate and significant cash value to our shareholders, while also allowing our shareholders to participate in the future upside of Elzonris’ European launch.

“We look forward to working closely together on our unified goal of helping and delivering hope to patients worldwide.”

The acquisition has been approved by the boards of directors of both parties. Subject to customary closing conditions, the deal should close in the second quarter of this year.