Amgen Inc. said on Wednesday that it plans to acquire Fremont-based drug development partner Abgenix Inc. for about $2.2 billion in cash, or $22.50 per share.

Shares of Abgenix, which closed at $14.65, jumped 49 percent to $21.88 in after-hours trading. Amgen shares, which closed at $76.78, rose 3 percent to $79.35.

Under the terms of the agreement, which has been unanimously approved by the boards of both companies, Amgen will pay shareholders of Abgenix $22.50 in cash per common share and will assume Abgenix outstanding debt.

The deal, which must be approved by regulators and Abgenix's shareholders, is expected to close in the first quarter of 2006. Amgen said it expects the deal to reduce adjusted earnings per share in 2006 and 2007 by 5 cents to 10 cents, but to add to earnings thereafter if panitumumab becomes a commercial success.

Thousand Oaks-based Amgen has been providing capital and clinical trial expertise to Abgenix for two of its experimental drugs, a potential blockbuster cancer treatment called panitumumab and a bone-building osteoporosis treatment called denosumab. The two companies are expected to file this week for Food and Drug Administration approval to market panitumumab to treat colon cancer.

Amgen estimates a $2 billion worldwide market for panitumumab for both colon cancer and head-and-neck tumors, another disease under study, said George Morrow, executive vice president of worldwide sales and marketing, during a conference call with analysts.

Amgen CEO Kevin Sharer called the acquisition a natural strategic fit given his company's long relationship with Abgenix and knowledge of its pipeline, which includes several other drugs developed with Abgenix's proprietary technology. Amgen plans to keep Abgenix's manufacturing facilities in Fremont, which are not far from another recent Amgen acquisition, South San Francisco-based Tularik Inc.

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