By Mariam Sunny

March 23 (Reuters) - Gilead Sciences said on Monday it would buy privately held biotech firm Ouro Medicines in a deal worth more than $2 billion to expand its pipeline of immune disorder drugs.

Best known for its HIV drugs, Gilead has been looking beyond its key areas for growth amid looming patent expiries and declining sales of its COVID-19 treatment, Veklury.

Last month, the drugmaker agreed to buy partner Arcellx for up to $7.8 billion, its biggest deal since 2020, to strengthen its lineup of cancer treatments.

The latest deal would give Gilead access to Ouro's experimental antibody drug, OM336, which is in early-stage studies to treat autoimmune conditions, including hemolytic anemia and Sjogren's disease, a muscle-weakening disorder.

"Ouro complements Gilead's growing I&I (immunology and inflammation) and oncology franchises while still leaving dry powder for more transactions," BMO Capital analyst Evan Seigerman said.

"If design considerations translate to the clinic, we could see OM336 displace traditional autoimmune disease therapies with less favorable safety profiles if approved," Seigerman said.

As part of the agreement, Gilead will pay Ouro's investors $1.68 billion upfront in cash and up to $500 million contingent on hitting certain milestones.

California-based Ouro is backed by investors such as private-equity firm TPG, British drugmaker GSK and venture capital firm Monograph Capital.

Gilead also said on Monday it was in advanced discussions with partner Galapagos to collaborate on the research and development of Ouro Medicines' assets.

If finalized, Galapagos would pay 50% of the upfront and 50% of any contingent milestone payments.

Galapagos would also fund the development of OM336 through the initiation of registrational studies, while rest of the costs would be split equally between the companies.

Gilead said it would retain global commercialization rights, except in Greater China where KeyMed Biosciences has existing rights. Galapagos would receive royalties of 20% to 23% of net sales.