Novartis to buy Avidity Biosciences for $12 billion
The deal, involving a company specialising in rare diseases, is the largest acquisition made under the leadership of CEO Vas Narasimhan
Novartis is back in the biotech sector with its biggest acquisition in ten years: the Swiss pharmaceutical group announced the purchase of US-based Avidity Biosciences for USD 12 billion, or USD 72 per share, a 46% premium over the stock's close last Friday on the Nasdaq.
The deal, the largest under the leadership of CEO Vas Narasimhan, gives Avidity an enterprise value of around $11 billion and strengthens Novartis' position in the field of rare and neuromuscular diseases.
According to Narasimhan, two of the three drugs under development by Avidity could achieve annual sales of several billion dollars, while the third has potential sales of between USD 500 million and USD 1 billion. The CEO explained that the goal of the acquisition is to anticipate the replacement of expiring patent revenues over the next decade:
"We want to strengthen the next five years in view of the patent deadlines in the early 2030s," Narasimhan told the Financia Times, "and create a solid growth base until 2040."
San Diego-based Avidity has developed an innovative platform based on RNA therapies, and recently presented positive clinical results for its investigational drug Del-zota, intended for the treatment of muscular dystrophy. The company expects to file for regulatory approval by the end of the year.
