NVS - Novartis deal to buy Chinook rallies Vera
2023-06-12 10:43:42 ET
Kidney disease drug developer Chinook Therapeutics ( KDNY ) added ~56% on Monday after announcing a $3.5B buyout deal with Novartis ( NVS ), sending the shares of its rival Vera Therapeutics ( NASDAQ: VERA ) sharply higher.
Per the terms, the Swiss pharma giant will acquire Chinook ( KDNY ) for $40 per share in addition to $4 per share in cash based on the achievement of certain regulatory milestones linked to its lead asset atrasentan targeted at IgA nephropathy.
Vera ( VERA ), whose lead asset atacicept is also in late-stage development for IgA nephropathy, jumped ~21% in reaction. Last week, announcing the launch of a pivotal Phase 3 study for atacicept in IgA nephropathy, the company said that it also expects mid-stage data for the candidate this month.
Meanwhile, following the deal with Chinook ( KDNY ), Bank of America maintained the Buy rating on Novartis ( NVS ), arguing that the acquisition, expected to close in H2 2023, will complement the company’s existing renal franchise.
“Strategically we see deal fits with size (sub USD5bn) and therapeutic area of focus for Novartis’s M&A strategy and builds on existing renal franchise,” BofA analyst Graham Parry wrote with a $120 per share target on the stock.
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Novartis deal to buy Chinook rallies Vera