Novartis AG agreed to buy Chinook Therapeutics Inc. for as much as $3.5 billion to add two promising treatments for a rare kidney disease that are currently in late-stage trials.
(Bloomberg) — Novartis AG agreed to buy Chinook Therapeutics Inc. for as much as $3.5 billion to add two promising treatments for a rare kidney disease that are currently in late-stage trials.
The Swiss drug company will pay $40 a share in cash for Seattle-based Chinook, or 67% above Friday’s closing, according to a statement Monday. Another $4 a share could be paid later based on achieving certain regulatory milestones.
Chinook has two treatments in late-stage trials to treat IgAN, a progressive, rare kidney disease that mostly affects young adults and currently lacks targeted treatment options.Â
Like other big pharma companies, the Swiss drugmaker is targeting rare diseases, a profitable field where treatments command a premium. The purchase would be the Swiss company’s largest since it bought Medicines Co. for about $9.7 billion in 2020.
Chief Executive Officer Vas Narasimhan has been more active lately in slimming Novartis down rather than boosting its drug pipeline through acquisitions. Narasimhan decided last year to spin off Novartis’s Sandoz unit, creating the largest European generic and biosimilar drug company by sales. Novartis is also considering selling some ophthalmology assets.
Novartis said it expects to complete the deal in the second half of 2023.Â
(Updates with strategy in fourth paragraph. A previous version of this story corrected where Chinook is based in second paragraph.)
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