Novartis (NOVN.S) will buy Seattle company Chinook Therapeutics (KDNY.O) for up to $3.5 billion to add a rare severe kidney disease treatment to its late-stage drug research pipeline.
The Swiss drugmaker announced Monday that a newly established Novartis subsidiary and Chinook would unite in the second half of 2023.
It claimed Chinook shareholders would receive $3.2 billion, or $40 per share, in cash and a contingent value worth up to $300 million, depending on regulatory successes, under the agreement. Chinook closed Friday at $23.99.
After cutting expenses and refocusing Novartis on the best therapeutic areas and geographic markets, CEO Vas Narasimhan wants to create blockbuster pharmaceuticals.
He said he would consider any deal prospects, most assets under $5 billion.
Chinook expects the pivotal readout of a clinical study of oral drug candidate atrasentan to treat IgAN in the fourth quarter of this year.
In the third quarter of 2023, Chinook will begin a Phase 3 trial of zigakibart, another injectable IgAN therapy.
Narasimhan won a key victory this year when breast cancer medicine Kisqali, one of two new drugs vital to the business’s sales growth, was demonstrated to help a larger patient group.
Iptacopan, which is being tested for a rare hereditary blood condition, may compete with AstraZeneca’s (AZN.L) Soliris and Ultomiris.
After spinning out Sandoz in the year’s second half, the Swiss pharma giant will be more dependent on drug research.
IgAN, a progressive autoimmune illness typically affecting young persons, might cause dialysis or kidney transplantation. Novartis reported no targeted therapy alternatives.
IgAN affects 21 individuals per million in the US, with Asians being more affected. The company said IgAN is the leading cause of kidney failure among young Caucasian adults.
