Rapid elimination of biotech-created zombies: A mission in progress
In a significant development in the biotech industry, Concentra Biosciences has recently acquired iTeos Therapeutics, a cancer therapeutics company based in the U.S. and Belgium. This acquisition is part of Concentra's broader strategy to consolidate struggling biotech companies, a trend that has been gaining momentum in 2025.
Concentra, established by Tang Capital Partners around two years ago, has been actively acquiring multiple distressed or "zombie" biotech companies. These companies, typically facing financial difficulties and clinical setbacks, either face pressure to dissolve or are bought out by firms like Concentra that aim to unlock the trapped capital and possibly develop any remaining viable science.
Annalisa Jenkins, chair of Alis Biosciences, another company pursuing a similar strategy, claims to have the support of public and private investors in her mission to "free" more than $30 billion of "trapped capital" in life science and biotech companies.
iTeos Therapeutics, the latest addition to Concentra's portfolio, held $156.5 million in cash and cash equivalents as of March 31. However, the company recently scrapped the development of its TIGIT inhibitor after it failed a phase 2 clinical trial. The acquisition was made at a slightly lower rate than the valuation of $10.26 per share when the deal was announced.
iTeos' lead candidate, Belrestotug, was its drug in question for indications such as head and neck cancer and non-small cell cancer (NSCLC). Notably, GSK collaborated with iTeos to co-develop and potentially market belrestotug for $625 million, but underwhelming data from the NSCLC study left the company high and dry.
Following the acquisition, iTeos announced it would spend around $24.7 million in layoff costs and $11.1 million to wind down all the operations and end contracts. This buying activity is part of a wider strategic reset in biotech, including new funds and investors focused on non-dilutive financing, royalty acquisitions, and capital recycling to sustain the biotech ecosystem amid challenging market conditions.
While these buyouts can return shareholder value and potentially salvage promising projects, it remains uncertain how much they will ultimately fuel innovation and successful R&D. Industry observers advise close monitoring of whether these interventions truly restart productive pipelines or merely consolidate failing assets.
Concentra has also acquired Elevation Oncology, IGM Biosciences, Kronos Bio, Allakos, and Cargo Therapeutics within five months. The acquisition of Cargo Therapeutics was made for $217.5 million at $4.38 per share, with shareholders receiving non-transferable contingent value rights.
Pliant Therapeutics, another biotech company, took a 'poison pill' to defend against an acquisition by Concentra Biosciences. The outlook for Concentra’s acquisitions reflects a cautious optimism in the sector, with the acquisitions poised to return shareholder value and potentially salvage promising projects. However, the full impact on innovation and R&D remains to be seen.
Kevin Tang, the founder of Tang Capital Partners and part of the board of directors at Aurinia Pharmaceuticals, leads Concentra Biosciences. Alis Biosciences, another company pursuing a similar strategy, seeks to return around 97% cash to investors, with the company then sold back to certain shareholders or stakeholders who wish to further develop any residual science.
As the biopharma industry continues to grapple with clinical and financial failures, leading to the existence of "zombie biotechs," companies like Concentra Biosciences are playing a crucial role in managing the lasting impact of these downturns and pipeline failures.
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