Oct 8 Reuters BristolMyers Squibb on Sunday said it will acquire cancer drugmaker Mirati Therapeutics for up to 5.8 billion, diversifying its oncology business and adding drugs it hopes can help offset expected lost revenue from patent expirations later this decade.

Bristol will pick up Mirati39;s portfolio drugs that target the genetic drivers of specific cancers including its lung cancer drug, Krazati, which was approved in December.

A second compound MRTX1719 which could be used in some types of lung cancer was also attractive to the company, Bristol executives said in an interview.

We think this really helps strategically complement our oncology portfolio but also, from a financial standpoint, it helps out commercially in the back half of the decade, said Adam Lenkowsky, Bristol39;s Chief Commercialization Officer.

The company said that it will buy Mirati for 58 per share in cash, or around 4.8 billion. Mirati has around 1.1 billion in cash on hand, so we39;re paying essentially 3.7 billion enterprise value…we think with that we39;ve gotten a very attractive deal, Lenkowsky said.

Mirati stockholders will also receive one nontradeable contingent value right for each Mirati share held, potentially worth 12.00 per share in cash, representing an additional 1 billion of value opportunity, the company said

Bristol will finance the transaction with a combination of cash and debt, the company said in a statement.

The U.S. Food and Drug Administration in December…