TOKYO: Japanese drugmaker Daiichi Sankyo said on Tuesday it would buy privately held pharmaceutical firm Plexxikon Inc of the United States for about $805 million dollars, aiming to grow its oncology business.

Daiichi is aiming to take advantage of a late-stage cancer drug, PLX4032, which California-based Plexxikon is jointly developing with Roche.

The Japanese firm will pay up to an additional $130 million dollars based on the drug's successful launch, Daiichi said in a statement.

The acquisition is subject to anti-trust approval in the United States, Daiichi said.

Based on the companies' projections for the year to March, Daiichi is expected to replace Astellas Pharma as Japan's No.2 drugmaker in terms of annual revenues.

Shares of Daiichi were up 1.1 percent at 1,772 yen after the announcement, roughly in line with a 0.9 percent rise in Japan's pharmaceuticals subindex