Novartis to acquire Avidity Biosciences for $12 billion in cash

Novartis AG on Sunday said it has agreed to acquire Avidity Biosciences Inc in a deal that values the RNA therapeutics-focused biopharmaceutical company at USD12 billion.

Novartis, a Basel, Switzerland-based pharmaceutical company, will purchase all outstanding shares in San Diego, California-based Avidity for USD72.00 each in cash, representing a 46% premium from the last closing price in New York on Friday.

The deal values Avidity at USD12 billion on a fully diluted basis, with an enterprise value of approximately USD11 billion at the anticipated closing date in the first half of 2026.

Novartis expects the acquisition to lift its 2024 to 2029 sales compound annual growth rate to 6% from 5%.

The agreement defining the terms of the deal has been unanimously approved by the boards of both companies, with Novartis set to conduct the transaction through a merger with a newly formed indirect wholly owned subsidiary of Novartis that will acquire the Avidity shares.

"Prior to the closing of the merger, Avidity will transfer to SpinCo, a wholly owned subsidiary of Avidity, the early-stage precision cardiology programs and collaborations of Avidity. The transfer includes certain Avidity assets whose transfer will trigger a right of first negotiation with an existing collaboration partner of Avidity," Novartis explained.

Avidity shareholders will receive a distribution of 1 SpinCo share for every 10 shares of Avidity they hold, alongside a pro rata cash distribution of any proceeds Avidity receives before closing from the sale of SpinCo assets or from the sale of SpinCo itself to a third party.

Novartis' acquisition of Avidity remains subject to the completion of a spin-off or sale of SpinCo, as well as other customary conditions, including approval from Avidity shareholders.

Novartis said: "The proposed acquisition aligns with the long-term neuroscience strategy of Novartis, expanding the company’s pipeline with potential near-term launches in genetically defined diseases with high unmet need.

"The proposed acquisition is expected to create an industry-leading pipeline, building on the Novartis expertise in spinal muscular atrophy and commercialization capabilities in genetic neuromuscular diseases."

Avidity's projects include late-stage disease-modifying therapies in myotonic dystrophy type 1, facioscapulohumeral muscular dystrophy, and Duchenne muscular dystrophy