Novartis to Buy AveXis for $8.7 Billion
April 09 2018 - 1:42AM
Dow Jones News
By Alberto Delclaux
Novartis AG (NOVN.EB) said Monday that it entered an agreement
to buy U.S.-based clinical-stage gene therapy company AveXis Inc.
(AVXS) for $8.7 billion dollars.
The pharmaceutical company will pay $218 per AveXis share, an
88% premium to its closing price on April 6. It intends to fund the
acquisition with available cash and short-term borrowing.
Novartis said it expects the deal to slightly hit core operating
income in 2018 and 2019, due to R&D investments. It said the
acquisition should strongly benefit core operating income and core
earnings a share as of 2020, however, driven by an increase in
sales.
AveXis is undertaking several clinical studies for the treatment
of spinal muscular atrophy, or SMA, an inherited neurodegenerative
disease caused by a defect in a single gene, Novartis said. Its
gene therapy candidate AVXS-101 has the potential to be the first
one-time gene replacement therapy for SMA, according to
Novartis.
The transaction was approved unanimously by the boards of the
two companies, Novartis said, and closing of the deal is expected
in mid-2018.
Write to Alberto Delclaux at alberto.delclaux@dowjones.com
(END) Dow Jones Newswires
April 09, 2018 01:27 ET (05:27 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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