LG Chem CEO Shin Hak-cheol / Courtesy of LG Chem

By Park Jae-hyuk

LG Chem decided to acquire a 100-percent stake in Boston-based AVEO Pharmaceuticals for $566 million to expand its commercial footprint to the U.S. and diversify its pipeline with a broad range of oncology therapies, the Korean firm said Tuesday.

Nasdaq-listed AVEO is the developer of FOTIVDA, which received U.S. Food and Drug Administration (FDA) approval in March of last year for the treatment of adult patients with relapsed or refractory advanced renal cell carcinoma (RCC) following two or more prior systemic therapies.

According to LG Chem, this is the first time that a Korean firm is acquiring a company that has won an FDA approval for a novel drug.

"This transaction represents the next step in our portfolio transformation towards higher growth markets and provides a strong commercial foundation in oncology as we continue to develop our anti-cancer offerings," LG Chem CEO Shin Hak-cheol said. "We remain focused on prudently investing in our R&D capabilities, continuing to build a leading portfolio of therapies and transforming lives through inspiring science and leading innovation."

For this deal, LG Chem plans to invest in LG Chem Life Science Innovation Center, so that the Boston-based subsidiary can establish a special purpose company to take over AVEO. The transaction is expected to be finalized in early 2023, subject to customary closing conditions, including AVEO shareholders' approval and regulatory processes.