Novartis bets big on gene therapy

ZURICH, Apr 9 (Reuters): Novartis is moving further into gene therapy with a $8.7 billion deal for AveXis that gives the Swiss drugmaker a rare-disease treatment seen reaping billions in sales and bolsters its technology base.

The acquisition is the latest example of a surge of interest in biotech deal-making this year as large pharmaceutical companies seek promising new assets to boost their pipelines.

The $218-per-share cash deal announced on Monday represents a 72 per cent premium to AveXis's 30-day volume-weighted average stock price. The transaction is seen closing in mid-2018.

Novartis Chief Executive Vas Narasimhan, who took over on Feb 1, is flush with cash, having just agreed to sell his company's stake in a consumer healthcare joint venture for $13 billion to GlaxoSmithKline.

Narasimhan is counting on AveXis's main drug, AVXS-101, for deadly spinal muscular atrophy (SMA), as well as the Illinois-based company's gene therapy expertise and manufacturing capabilities, to bolster Novartis's neuroscience business, one of the Swiss company's main focus areas.