UK drugmaker Shire Plc (SHP.L) said it would buy privately held biotechnology firm FerroKin BioSciences for up to $325 million, including an upfront cash payment of $100 million, to expand its portfolio of blood disease treatments.
The deal terms also included potential milestone payments of up to $225 million.
U.S.-based FerroKin develops treatments for patients with iron overload and its main drug candidate FBS0701 is currently in mid-stage clinical trials.
FBS0701 is a once-daily use capsule that is being tested as a treatment for iron overload due to chronic blood transfusions in adults and children.
"We hope to use our expertise in hematology coupled with our proven ability to progress products through the development pipeline to bring FBS0701 to the global marketplace," Shire said in a statement.
Shire is a specialist in developing drugs for hyperactivity and rare genetic diseases and has been touted as the hottest takeover target in the European pharmaceutical sector since French drugmaker Sanofi (SASY.PA) bought U.S. biotech firm Genzyme early last year.
Shares of the company, which pulled its U.S. application for a genetic disorder drug on Wednesday as it expected the agency to ask for more trials, were trading down about 2 percent at 2191 pence at 1147 GMT on Thursday on the London Stock Exchange.
(Reporting by Esha Dey in Bangalore; Editing by Brenton Cordeiro)