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Sun Pharmaceutical Industries Ltd. has agreed to buy US-based immunotherapy and oncology firm Checkpoint Therapeutics Inc. for an upfront payment of $355 million, as India’s largest drugmaker bolsters its specialty therapy portfolio.

Sun Pharma will buy the outstanding shares of Waltham, Massachusetts-based Checkpoint for $4.10 each upfront — about 66% above Checkpoint’s Friday closing price, the Mumbai-based firm said in a filing Monday. It will also exercise a non-transferable contingent value right of up to $0.70 per share in cash based on certain conditions, the filing added.

The acquisition is the firm’s second in less than three months, as it tries to rapidly diversify beyond generic drugs and build out a portfolio of novel therapies. The US — world’s largest pharmaceutical market — contributed roughly a third to Sun Pharma’s revenue in the year ended March 31, 2024.

“Patients with cSCC may soon have access to an important, new treatment option,” said Dilip Shanghvi, Sun Pharma’s chairman said in the statement. “The acquisition further bolsters our innovative portfolio in onco-derm therapy.”

USFDA Approval

Checkpoint has received approval from the US Food and Drug Administration for UNLOXCYT, to be used for treating adults with metastatic cutaneous squamous cell carcinoma (cSCC), the second-most common type of skin cancer in the US.

There are about 1.8 million cases of cSCC in the US annually, with about 40,000 cases turning severe, the firm said. The ailment causes an estimated 15,000 deaths in the US each year.

“Our analysis shows Unloxcyt could hit peak sales of $200 million annually in the US alone,” Bino Pathiparampil, head of research at Elara Capital wrote in a note Monday. Since Sun Pharma already has a dermatology sales force in the US, “incremental fixed cost of selling the product would be low,” he added.

Sun Pharma’s shares rose as much as 2.1% before paring nearly all the day’s gains by the time trading ended in Mumbai. The transaction is expected to be completed by June 2025, the Indian drugmaker said.