Swiss pharmaceutical giant Novartis AG has agreed to acquire Avidity Biosciences Inc. in a $12 billion all-cash deal, marking its largest acquisition in more than ten years. The move aims to strengthen Novartis’s pipeline with next-generation treatments as it faces growing competition from generic versions of its key drugs.
Under the agreement, Novartis will pay $72 per Avidity share in cash, representing a 46% premium over Avidity’s closing price on Friday. The acquisition was first reported by Bloomberg News.
Avidity Biosciences, a US-based biotech firm, is developing experimental therapies for rare and genetic diseases, including myotonic dystrophy type 1, a neuromuscular disorder that causes progressive muscle weakness. According to Novartis, two of Avidity’s three leading drug candidates — expected to launch before 2030 — each have multibillion-dollar sales potential.
In Monday trading, Novartis shares slipped about 1% in Zurich, though they remain up around 16% year-to-date. Avidity’s stock closed 1.2% higher at $49.15 on Friday, valuing the company at approximately $6.8 billion.
The acquisition underscores CEO Vas Narasimhan’s shift toward targeted, high-impact acquisitions. While previous deals under his leadership have typically stayed below $5 billion, this purchase reflects a bolder approach to secure future growth across Novartis’s focus areas — cardiovascular, immunology, neuroscience, oncology, and metabolic disorders.
Novartis faces a looming “patent cliff” as generic versions of its blockbuster heart drug Entresto and two other key medicines are set to enter the market later this year. To counter this, the company has been pursuing strategic acquisitions, including Tourmaline Bio ($1.4 billion), Regulus Therapeutics (up to $1.7 billion), and Anthos Therapeutics, which bolstered its cardiology portfolio.
Avidity’s platform leverages antibody-oligonucleotide conjugates (AOCs) — a new class of medicines that use synthetic RNA to precisely target genetic causes of disease. Its drug for Duchenne muscular dystrophy has received “breakthrough therapy” designation from the US FDA, highlighting its clinical potential.
As part of the transaction, Avidity will spin off its early-stage precision cardiology programs into a separate entity, which may later be sold to a third party. The $12 billion valuation includes roughly $1 billion in cash held by Avidity, and the deal is expected to close in the first half of 2026, pending completion of the spinoff and regulatory approvals.
Novartis said the acquisition will raise its expected sales CAGR (2024–2029) from 5% to 6%, reflecting stronger long-term growth prospects.
Analyst Stefan Schneider of Vontobel called the transaction a “perfect fit” for Novartis’s acquisition strategy, adding that it presents “ample potential for revenue generation.”
The deal adds to a growing wave of biotech M&A activity, as major pharmaceutical firms seek innovative assets to replenish their pipelines amid rising generic competition.
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