Novartis AG (NVS) Announces Deal for Radiopharmaceutical Company

Novartis to buy cancer drugmaker Endocyte for $2.1 bln in cash

Novartis to buy cancer drugmaker Endocyte for $2.1 bln in cash

It also announced on Thursday the $2.1 billion acquisition of US biopharmaceutical company Endocyte. This offer represents a premium of 54% to Endocyte's closing price of $15.56 on October 17.

With the purchase, the Swiss company is adding to its arsenal of radiopharmaceuticals, a new group of drugs created to more closely target cancer cells.

Narasimhan said that transaction prompted Novartis to expand relationships with US and European nuclear medicine centers. The transaction is expected to be completed in the first half of 2019 and Endocyte will continue to operate as a separate and independent company until then.

It's in response to a $2.1 billion buyout by the Swiss drugmaker Novartis.

The treatment targets the prostate-specific membrane antigen (PSMA), present in the majority of patients with mCRPC, and has shown promising Phase II data, Novartis said. The Phase III study, VISION, enrolled its first patient in June.

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Endocyte's board has unanimously approved the acquisition deal.

"Note a below-average reaction time at the business development department considering that the Endocyte market cap was at $110 million only 12 months ago", Baader Helvea's Bruno Bulic said.

The Endocyte pipeline includes additional investigational RLTs, including 225Ac-PSMA-617 in preclinical studies for the treatment of mCRPC. Endocyte specializes in so-called radiopharmaceuticals, a new class of drug that carries radioactive substances directly to cancer cells so they can kill tumor cells at close range. AAA's radiopharmaceutical drugs are used to diagnose and treat cancer and other diseases.

Novartis also raised its full-year sales outlook, citing growing revenue from its Cosentyx psoriasis and arthritis drug as well as the performance of its heart failure medicine Entresto, whose third-quarter sales more than doubled. Novartis plans to fund the acquisition with available cash.

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