Swiss drugmaker Novartis has announced plans to acquire U.S.-based biotech firm Avidity Biosciences in an all-cash deal valued at approximately $12 billion, as part of its strategy to expand its pipeline of treatments for rare muscle and neuromuscular disorders.
Under the terms of the agreement, Avidity shareholders will receive $72 per share in cash, representing a 46% premium over the company’s last closing price. The deal, first reported by Bloomberg News, marks one of Novartis’ largest transactions this year.
Deal Structure and Spin-Off
As part of the transaction, Avidity will spin off its early-stage precision cardiology programs into a separate entity called Spinco, which is expected to become a publicly traded company. Kathleen Gallagher, currently Avidity’s Chief Programme Officer, will lead the new company.
The acquisition underscores Novartis’ ongoing push to diversify its portfolio amid looming patent expirations for several blockbuster drugs, including Entresto, Xolair, and Cosentyx.
Strategic Expansion in Rare Diseases
Headquartered in San Diego, California, Avidity is a clinical-stage biotech firm developing RNA-based therapeutics that target muscle tissues. Its lead candidate, Del-zota, is in mid-stage development for a rare subtype of Duchenne muscular dystrophy (DMD). The company is also advancing two additional experimental therapies for serious muscle diseases, all expected to seek regulatory approval by 2026.
The acquisition allows Novartis to strengthen its position in the rare disease segment, a field with limited treatment options but strong growth potential.
Regulatory and Market Context
The deal comes amid trade and tariff tensions between the United States and Switzerland, with pharmaceutical companies like Johnson & Johnson, Roche, and Sanofi pledging major U.S. investments to mitigate potential policy risks. Although pharma exports were initially exempt from new tariffs, Novartis’ move reinforces its commitment to expanding its U.S. footprint.
In Line with Recent M&A Strategy
The Avidity deal continues Novartis’ streak of targeted acquisitions in advanced therapeutics:
- Kate Therapeutics (Nov 2024): Gene therapies for neuromuscular diseases
- Anthos Therapeutics (Feb 2025): $3.1 billion deal in cardiovascular medicine
- Regulus Therapeutics (Apr 2025): $1.7 billion acquisition for kidney disorder treatments
- Matchpoint Therapeutics (Jul 2025): Up to $1 billion collaboration in inflammatory diseases
Summary:
Novartis’ $12 billion acquisition of Avidity Biosciences marks a strategic expansion into the rare muscle disorder segment, enhancing its RNA therapy capabilities while strengthening its U.S. presence. The move aligns with the company’s broader M&A strategy aimed at countering upcoming patent expirations and reinforcing its long-term growth pipeline.
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