Los Angeles biotech Abraxis BioScience Inc., founded by billionaire Dr. Patrick Soon-Shiong, on Wednesday said it was being acquired by a New Jersey drug company for $2.9 billion in cash and stock.

Celgene Corp., a Summit, N.J. maker of cancer and immune-inflammatory drugs, will pay Abraxis shareholders -- the largest of which is Soon-Shiong -- $58 and 0.26 shares of Celgene for each Abraxis share they own. That values Abraxis at $71.93 per share, based on Tuesday’s closing price of Celgene stock, and is a 17 percent premium on Abraxis’ closing price.

The deal values Soon-Shiong roughly 80 percent stake in the company at more than $2.54 billion, $376 million more than it was worth yesterday.

Shareholders also will get harder-to-value "contingency value rights" units, which entitle them to share in future milestone payments if Abraxane get approved to treat other types of cancers now under study.

Abraxis is the maker of Abraxane, which is approved for metastic breast cancer. The drug is also in studies to treat skin, lung, and pancreatic cancer.

The deal is the second big payday in the last three years for Soon-Shiong, who controls about 80 percent of Abraxis shares through direct and trust holdings. The South African-born researcher and former UCLA surgeon received $3.7 billion from his share of the 2008 sale of generic drug maker APP Pharmaceuticals Inc., which he also founded. He has topped the Business Journal’s list of Wealthiest Angelenos for the past two years, with an estimated net worth of $7.1 billion as of May.

The deal is expected to close in the fourth quarter. Celgene will pay an additional $250 million if Abraxane is approved to treat non-small cell lung cancer and $300 million more if it is approved for pancreatic cancer. If the pancreatic cancer approval comes by April 1, 2013, Celgene will pay another $100 million.

Abraxane is based on a proprietary nanotechnology platform called “nab,” which was developed by Soon-Shiong in the 1990s. The “Trojan horse-style” technology enables larger doses of a longtime cancer treatment called paclitaxel to be delivered to tumors more effectively and with fewer side effects.

“Our nab technology platform is changing the treatment paradigm for difficult-to-treat cancers,” Soon-Shiong said in a statement. “In Celgene we have found the ideal partner to further expand the reach of Abraxane and our other treatments, in order to improve the lives of patients worldwide.”

Abraxane sales totaled $85.9 million in the first quarter, slightly down from a year earlier. Celgene said it is determined to "re-energize" sales of the drug, which currently is approved for use after other cancer treatments have failed. The deal is expected to close in the fourth quarter.

"The acquisition of Abraxis BioScience is an exceptional strategic fit that will accelerate our strategy of becoming a global leader in oncology," Celgene CEO Bob Hugin said in a statement.

Abraxis shares closed up $12.99, or 21 percent, to $74.30 on the Nasdaq. Celgene shares closed down $2.48, or 4.6 percent, to $50.76.

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