- Novartis has agreed to buy Avidity Biosciences in a deal valued at $72 per share.
- The deal is expected to close in the first half of 2026.
- Retail sentiment toward Avidity Biosciences stock flipped to ‘extremely bullish’ by early Monday from ‘bearish’ a day ago.
Avidity Biosciences, Inc. (RNA) shares soared over 43% in Monday’s early premarket session after the mid-cap biopharma focusing on developing RNA therapeutics called antibody oligonucleotide conjugates (AOC), announced a deal to be bought by Swiss pharma giant Novartis (NVS).
Avidity Biosciences stock has gained more than 60% this year.
The Novartis Deal Terms
In a statement released on Sunday, Novartis said it would acquire San Diego-based Avidity Biosciences following the separation of the latter’s early-stage precision cardiology programs. The deal, approved by the boards of both companies, is valued at $72 per share in cash. This represented a 46% premium over RNA stock’s closing price of $49.15 on Friday.
The total transaction value is $12 billion on a fully diluted basis. Avidity Biosciences currently boasts a market capitalization of $7.17 billion.
Vas Narasimhan, CEO of Novartis, said, “Avidity’s pioneering AOC platform for RNA therapeutics and its late-stage assets bolster our commitment to delivering innovative, targeted, and potentially first-in-class medicines to treat devastating, progressive neuromuscular diseases.”
Before the merger’s closing, Avidity will transfer its early-stage precision cardiology programs and collaborations to SpinCo, a wholly owned subsidiary of Avidity. Holders of Avidity common stock will receive a distribution of one share of SpinCo for every ten shares of Avidity they hold and/or a pro rata cash distribution of the proceeds received by Avidity before the closing if certain SpinCo assets are, or SpinCo itself is, sold to a third party.
The deal is expected to close in the first half of 2026, subject to the completion of a spin-off or the sale of SpinCo and other customary closing conditions, including the receipt of regulatory approvals and the approval of Avidity stockholders.
Novartis said the proposed acquisition raises the expected 2024-2029 sales growth from 5% to 6% on a compounded annual growth rate (CAGR) basis, representing a significant opportunity to deliver substantial shareholder returns over time.
What Retail’s Saying About The Buyout Deal
Retail sentiment toward Avidity Biosciences stock flipped to ‘extremely bullish’ by early Monday from ‘bearish’ a day ago. The message volume on the stream also improved to ‘extremely high.’ Retail chatter spiked 6,100% over the 24 hours leading up to late Sunday.
A bullish user noted that RNA traded at $5 two years ago and congratulated the believers.
Another user said they would cash out on Monday.
Earlier this month, Avidity Biosciences said it has completed a positive pre-Biologic License Application (BLA) meeting with the FDA regarding its delpacibart zotadirsen, an investigational drug being evaluated as a potential treatment for people living with Duchenne muscular dystrophy (DMD) who have gene mutations amenable to exon 44 skipping.
The timing for the BLA submission was pushed back to the first quarter of 2026 from the previous guidance of year-end 2025.
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