Novartis in advanced talks to buy Cytokinetics: Source

Novartis is poised to prevail in the auction for Cytokinetics, ahead of other bidders that include AstraZeneca and Johnson & Johnson, according to the source.

A deal could be announced as early as this week, the source said, helping Novartis gain access to Cytokinetics' experimental treatment, aficamten, for hypertrophic cardiomyopathy (HCM), an inherited chronic heart disease that can cause cardiac arrest.

Spokespersons for Cytokinetics and Novartis said the companies do not comment on M&A speculation.

Vontobel pharmaceuticals analyst Stefan Schneider said a deal made sense for Novartis, with Cytokinetics active in the cardiovascular field, one of the Swiss company's five main therapeutic areas.

Access to Cytokinetics products would help Novartis offset the expected loss of U.S. exclusivity of Entresto, its key drug in this field, he added.

"Novartis would probably have to pay a significant premium to the current share price," Schneider said.

"Novartis could easily manage a takeover in the low double-digit billion dollar range and would also have further financial leeway for acquisitions afterwards," he added.

In late December, Cytokinetics' shares jumped over 82% after aficamten met the main goal of a keenly awaited late-stage study, putting it on track to compete with a rival treatment from Bristol Myers Squibb.

Shares of Cytokinetics with a market capitalization of over $9 billion, as of Friday's closing price, have more than tripled in value since Oct. 31, when reports of the company attracting takeover interests first surfaced.

HCM is the most common inherited cardiovascular disorder, with about 280,000 patients in the U.S. currently, including two-thirds with obstructive HCM and the rest with non-obstructive HCM, the company estimates.

Original news source: https://www.reuters.com/markets/deals/novartis-advanced-talks-buy-cytokinetics-wsj-2024-01-08/#:~:text=Jan%209%20(Reuters)%20%2D%20Swiss,the%20matter%20said%20on%20Monday.