Novo Nordisk said Thursday it will pay up to $5.2 billion to acquire Akero Therapeutics for its experimental liver disease treatment.
Akero stock catapulted 16.3%, closing at 54.08, while Novo shares slid 1.6% to 58.68.
Akero is testing its drug, efruxifermin, as a treatment for metabolic dysfunction-associated steatohepatitis, or MASH. In this disease, fat builds up on the liver over time, causing scarring called fibrosis. Eventually, this leads to permanent damage known as cirrhosis. Patients with cirrhotic livers typically need a liver transplant.
Efruxifermin is the only treatment to show a significant reduction in fibrosis among patients with cirrhotic livers, Novo Nordisk said in a news release. Though Novo Nordisk's weight-loss drug, Wegovy, is approved to treat patients with lower levels of fibrosis, the company says there's still a huge unmet need for additional treatments, especially in later stages of the disease.
"We believe efruxifermin could be a first- and best-in-class treatment for mid- to late-stage MASH with the potential to reverse liver damage," Novo Nordisk Chief Scientific Officer Martin Lange said in a written statement.
CVR Sweetens The Deal
Novo will pay $54 per share of Akero stock for an upfront payout of $4.7 billion. The deal also includes a contingent value right worth $6 per share, payable if efruxifermin wins Food and Drug Administration approval to treat compensated cirrhosis. That brings the deal's total value up to $5.2 billion.
Akero is currently testing efruxifermin in two Phase 3 studies. Fibrosis is measured on a scale of one to four, with four being the worst. In mid-stage testing, patients with fibrosis levels two or three had a 49% reduction in fibrosis with no worsening in other MASH symptoms over 96 weeks. In patients with level four fibrosis, or cirrhosis, the drug reduced fibrosis by 29%.
The Novo/Akero deal follows Roche's plan in September to buy 89bio for its experimental MASH drug. 89bio's treatment, pegozafermin, uses the same mechanism as Akero's.
More to follow.
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