Novartis acquires UK biotech Myricx Bio for $1.5 billion
(Novartis) has agreed to acquire British cancer treatment group Myricx Bio in a deal that may be worth a total of up to $1.5 billion, becoming the latest acquisition of a British biotech company by a foreign company. The Swiss pharmaceutical group said on Monday it would make a $1.1 billion down payment to acquire London-based Myricx. The company was founded in 2019 to commercialize research from Imperial College and the Francis Crick Institute. Novartis will pay an additional $400 million upon achievement of certain milestones. Myricx is developing a new class of antibody-drug conjugates (ADCs), a cancer treatment that delivers more targeted chemotherapy drugs directly to affected cells. The acquisition strengthens Novartis' R&D pipeline in oncology - an area where the company has been seeking rapid innovation. The group is also investing heavily in radioligand therapy, an emerging form of targeted cancer treatment that has been hailed as a potentially game-changing technology. Novartis shares rose 0.5% in early trading on the SIX Swiss Exchange on Monday. The deal is another sign of big pharmaceutical groups’ strong interest in UK life sciences start-ups. Merck last year acquired Verona, which specializes in treating chronic lung diseases, for $10 billion; (Amgen) acquired cancer biotech company Dark Blue Therapeutics in January this year in a deal that could be worth as much as $840 million. Obesity start-up Metsera, which Pfizer acquired for $10 billion last year, is based largely on research conducted by a company spun out of Imperial College London. The spate of foreign acquisitions of British biotech companies comes as ministers and executives worry about whether high-growth British companies can remain independent and develop enough candidates to fill the London stock market, which has faced an exodus of companies in recent years. Novartis said Myricx's two main assets have the potential to "deliver payloads with differentiated killing effects to tumor cells" and may improve the shortcomings of existing ADCs or treat cancers that are resistant to the most commonly used ADCs on the market. These assets are still in the very early stages of development. Analysts at Barclays said in a note that the price looked "fully valued" for "a business that currently does not have supporting clinical data." But they added, "On the positive side, we believe this deal is strategically consistent with Novartis' focus on oncology; we believe ADCs are a technology path that may be widely applicable to multiple cancer types; we are also optimistic about its potential advantage of a longer market exclusivity period." Analysts also said that given the assets are still quite far away from any potential listing, any benefits from the deal are likely to be long-term and will require more spending as Novartis seeks to fund the development of the assets.