Novartis to Buy Breast Cancer Drug for as Much as $3 Billion
(Bloomberg) — Novartis AG agreed to buy an experimental breast cancer drug from Synnovation Therapeutics for as much as $3 billion to bolster its oncology pipeline.
The Swiss pharma company will pay the US biotech firm $2 billion upfront and as much as $1 billion in milestone payments for its Pikavation Therapeutics business, which is developing the potential treatment, according to a statement Friday.
The acquisition — expected to be closed in the first half of this year subject to regulatory approvals — furthers Chief Executive Officer Vas Narasimhan’s drive to expand Novartis’ oncology portfolio with precision therapies.
Novartis’s current treatment for this type of breast cancer, Piqray, will probably see its sales drop 9% to about $348 million this year, according to analysts surveyed by Bloomberg.
“Adding a next generation asset to its pipeline is a meaningful move,” Stefan Schneider, an analyst at Vontobel, wrote in a note.
Urban Fritsche at ZKB said the transaction was “a positive first step” and further similar transactions are to be expected in coming months.
The oral treatment is aimed at patients with HR+/HER2- breast cancer and is being evaluated in a Phase 1/2 study for breast cancer and other advanced solid tumors, the companies said.
It is designed to target tumors while sparing normal cells, an approach that can potentially translate “into improved tolerability and more durable benefit for patients,” Novartis said.
Through Thursday, Novartis shares had advanced 6.6% this year. Synnovation is privately held.
–With assistance from Lisa Pham, Naomi Kresge and Iain Rogers.
(Updates with analyst comment starting in third paragraph.)
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