That is a great result for Endocyte-its shares rose 50%. The transaction was unanimously approved by the board of directors of Endocyte, but it is still subject to Endocyte stockholder and regulatory approvals.
Novartis will pay $24 a share for Endocyte, 54% more than its closing price Wednesday of $15.56, the Basel-based company said Thursday.
Until the deal is finalised, Endocyte will continue to operate as a separate and independent company.
"Net sales revised upwards, expected to grow mid-single digit (cc); core operating income guidance confirmed, expected to grow mid to high-single digit (cc)", Novartis said in its earnings release.
Novartis said that, after completing the deal, it will harness its research and expertise to investigate the development of Endocyte's 177Lu-PSMA-617, a radioligand therapy for the treatment of metastatic castration-resistant prostate cancer.
The company's products in pre-clinical development include EC2629, a folate receptor-targeted SMDC for use in treating cancer; EC2319 for the treatment of inflammatory diseases; EC0371 for treating polycystic kidney disease; and SMDC bi-specific adaptor chimeric antigen receptor T-cell for the treatment of immunotherapy in cancer.
Since taking over in February, Narasimhan has shed over-the-counter medicines and generic pills while pushing a spinoff of Novartis's Alcon eyecare unit come 2019.
The acquisition of Endocyte builds on Novartis' January 2018 $3.9-billion purchase of Advanced Accelerator Applications, through which the company gained Lutathera, a peptide receptor radionuclide therapy that has gained European and the US approval for the treatment of somatostatin-receptor positive gastroenteropancreatic neuroendocrine tumors.
The company uses its technology to create novel small molecule drug conjugates (SMDCs) and companion imaging agents.
Stocks in a West Lafayette drug development company are soaring Thursday.