Drugmaker Novartis said on Monday it will acquire MorphoSys AG, a developer of cancer treatments, for 2.7 billion euros ($2.9 billion), adding a promising rare bone-marrow cancer treatment candidate to its portfolio.
Reuters first reported on Monday that Switzerland-based Novartis was in advanced talks to acquire MorphoSys, leading to the German biotech firm's shares surging more than 40 percent.
Novartis will offer shareholders 68.00 euros per share in cash and take MorphoSys private after the deal, which is contingent on certain conditions, including a minimum acceptance threshold of 65 percent of MorphoSys' share capital and regulatory clearances, the companies said.
The Planegg, Germany, headquartered MorphoSys will continue to operate as a separate, independent company until the completion of the deal, expected in the first half of 2024.
Novartis will own pelabresib, one of MorphoSys' most promising drugs, which is used to fight deadly forms of cancers such as myelofibrosis, a rare type of bone marrow cancer, and certain types of knotty lymphomas.
MorphoSys said in a separate statement that its management board and supervisory board intend to recommend its shareholders to accept Novartis' offer.
MorphoSys secured pelabresib, with a $1.7 billion takeover from U.S. cancer specialist Constellation Pharma, in the hopes of setting a new treatment standard.
In December, pelabresib met its late-stage primary study goal and all four hallmarks of disease in myelofibrosis, when used in combination with ruxolitinib, a class of drugs called JAK inhibitors.
The company now intends to file U.S. approval application for the combination treatment in the second-half of 2024.
For years, Novartis' Jakavi was the only approved drug for the indication but around half of myelofibrosis patients who benefit from the drug lose their treatment response after two to five years.
($1 = 0.9311 euros)
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