Novartis to Buy US Biotech Tourmaline Bio for $1.4 Billion
(Bloomberg) — Novartis AG agreed to buy Tourmaline Bio Inc. in a deal valued at about $1.4 billion as the Swiss drugmaker continues to pursue bolt-on deals to boost its drug pipeline.
The company will pay $48 per share in cash for the New York-based biotech, which is developing a promising treatment to reduce systemic inflammation, a major driver of cardiovascular disease. That’s a premium of about 60% to Tourmaline Bio’s closing price of about $30 on Monday.
Tourmaline Bio stock rose as much as 57% in premarket trading on Tuesday, with the shares trading just under the offer price at $47.25. Novartis fell slightly in early trading, but remains up about 15% since the start of the year.
Novartis has been on the hunt for acquisitions that could boost its sales beyond 2025. The company is facing competition from cheap generics later this year for three key drugs, including its top-selling heart medicine Entresto. In April, the company also agreed to buy US biotech Regulus Therapeutics in a deal that could be valued up to $1.7 billion.
“This deal makes strategic sense as it complements Novartis’s cardiovascular franchise that focuses on high, unmet need in cardiovascular diseases,” Stefan Schneider, an analyst at Vontobel wrote in a note.
Chief Executive Officer Vas Narasimhan has spent years revamping the company’s aging portfolio and has narrowed the company’s focus to innovative medicines in specific types of diseases. In April, Novartis raised its outlook for the year after profit beat estimates in the first quarter, driven by medicines for breast cancer, multiple scleroris and psoriasis.
Tourmaline is focused on developing an anti-IL-6 IgG2 antibody drug called pacibekitug to treat atherosclerotic cardiovascular disease, or ASCVD, Novartis said Tuesday.
ASCVD is caused by plaque buildup in the arterial walls. Related conditions, including coronary heart disease and peripheral artery disease, remain the leading cause of morbidity and mortality globally, according to the American Heart Association.
“With no widely adopted anti-inflammatory therapies currently available for cardiovascular risk reduction, pacibekitug represents a potential breakthrough in addressing residual inflammatory risk in ASCVD,” Novartis’ President of Development and Chief Medical Officer Shreeram Aradhye said in the statement.
The transaction has been approved by the boards of both companies and is expected to close in the fourth quarter of 2025.
–With assistance from James Cone and Subrat Patnaik.
(Updates with Tourmaline Bio premarket trading in third paragraph.)
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