The transaction does not require regulatory approval, and is expected to close before the end of the year.
deCODE was established in 1996, several years before the human genome had been sequenced. Founder and CEO Kari Stefansson hoped to tap into the information held in Iceland's unique genetic heritage, which has changed little since the Vikings arrived more than 1,000 years ago, to work out the links between gene variants and common diseases.
But despite its success in the laboratory, deCODE performed poorly after going public in 2000 and filed for bankruptcy protection in 2009, having never turned a profit in its 13-year existence.
In a statement, Robert Bradway, Amgen's president and CEO, suggested that the acquisition would help his company bolster its research efforts. 'deCODE Genetics has built a world-class capability in the study of the genetics of human disease', he said. 'This capability will enhance our efforts to identify and validate human disease targets. This fits perfectly with our objective to pursue rapid development of relevant molecules that reach the right disease targets'.
deCODE has indeed been prolific in identifying potential gene targets for various conditions and unearthing other genetic links. In 2012 alone, deCODE helped identify a rare mutation that protects people from getting Alzheimer's disease (reported in BioNews 665), another that significantly raises the risk of Alzheimer's (BioNews 682), and published a study suggesting that older men are more likely to father children with autism (BioNews 670).
But commercialisation of the technology behind such discoveries has proved problematic for the company. Most of the genetic variations unearthed by deCODE only slightly raise the risk of developing that disease, meaning there would be little demand for tests to detect them. However, gene identification can help explain the mechanism of a disease, and this information can lead to new targets for pharmaceutical companies.
Reaction from investors seems to have been positive, if muted. According to the New York Times, Geoffrey Porges, an analyst at Sanford Bernstein, issued a statement saying that 'while deCODE had good science, the payoff for Amgen in terms of bringing drugs to market would likely be five to 10 years away'.
Talking to Forbes magazine, Dr Sean Harper, Amgen's executive vice president for research and development, defended the company's newest acquisition: 'Having that information [from deCODE] that […] targets are relevant in human disease as opposed to not having it and relying on animal models is a huge thing for us given that we can only explore a small number of drug targets in any given time'.
Two of the most exciting experimental drugs - one for osteoporosis and one for high cholesterol in Amgen's pipeline – Dr Harper added, came from human genetic studies.
Talking to the New York Times, Dr Harper also mentioned that Amgen had already dropped some targets based on published findings from deCODE. 'We're looking for more of that confidence, more of that ability to pick the winners,' he told the newspaper.