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Mergers & Acquisitions

Novartis to acquire The Medicines Company for $9.7 billion

Deal will give Novartis the experimental cholesterol-lowering RNAi therapy inclisiran

by Ryan Cross
November 26, 2019 | APPEARED IN VOLUME 97, ISSUE 47

Novartis has agreed acquire The Medicines Company (TMC) and its experimental cholesterol-lowering drug inclisiran. The $9.7 billion deal is a bet by Novartis CEO Vasant Narasimhan that inclisiran will be the drug to take RNA interference (RNAi) technology from niche to blockbuster status.

Inclisiran was designed by the RNAi therapy company Alnylam Pharmaceuticals. In 2013, TMC struck a deal to license the compound and test it in Phase II and III clinical trials. So far, only two RNAi drugs have won approval, both Alnylam therapies for rare diseases.

Inclisiran indirectly lowers low-density lipoprotein cholesterol (LDL-C)—a form of cholesterol linked to atherosclerosis and heart disease at high levels—by preventing production of an enzyme called PCSK9 in the liver. Lowering the enzyme helps the body remove LDL-C from the bloodstream. Inclisiran reduced LDL-C by about 50% in studies of nearly 500 people with heterozygous familial hypercholesterolemia and over 3,100 people with atherosclerotic cardiovascular disease.

TMC plans to submit inclisiran to the US Food and Drug Administration this year and to European regulators in early 2020. If approved, it will join two other PCSK9 inhibitors on the market: Regeneron’s Pralulent and Amgen’s Repatha, both of which debuted in 2015 and sell for about $14,000 a year.

Neither has been an easy sell. The drugs are monoclonal antibodies that must be injected every 2 or 4 weeks. Regeneron and Amgen have both cut prices by more than half in a bid to boost prescriptions. Neither has yet to reach $1 billion in annual sales.

At the Oligonucleotide Therapeutics Society meeting in October 2018, TMC founder Clive Meanwell said that pricing inclisiran between $3,000 and $7,000 a year would be cost-effective for most patients. That’s significantly cheaper than Alnylam’s two existing RNAi therapies—Onpattro and Givlaari—which have list prices of $450,000 and $575,000, respectively.

Despite slow sales for Pralulent and Repatha, Novartis expects that inclisiran will become a blockbuster with annual sales of $4 billion to $8 billion by 2030. Getting there will require convincing doctors that the drug is useful for preventing heart disease. TMC is currently conducting a study of 15,000 people to determine inclisiran’s potential for reducing the risk of major cardiac events—like myocardial infarction and stroke—and cardiovascular-related deaths.

The TMC acquisition is the latest in a series of deals struck by Narasimhan since becoming CEO in 2018. That year, Novartis spent $8.7 billion on the gene therapy firm AveXis, which won US approval for the rare disease treatment Zolgensma this May.

Narasimhan went on to acquire the cancer company Endocyte and the Takeda Pharmaceutical eye drug Xiidra. In 2018, the firm divested its consumer health care division for $13 billion; this year it completed the spin-off of its eye care unit, Alcon, to shareholders.

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