Novartis to buy cancer drugmaker Endocyte for $2.1 bln in cash

Pearl Mccarthy
October 20, 2018

Endocyte, Inc. (NASDAQ: ECYT) on Thursday announced its $2.1-billion cash sale to Novartis AG (NYSE: NVS).

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Novartis said that, after completing the deal, it will harness its research and expertise to investigate the development of Endocyte's 177Lu-PSMA-617, a potential first-in-class investigational radioligand therapy (RLT) for the treatment of metastatic castration-resistant prostate cancer.

The transaction would be in the form of a merger of Endocyte and a newly formed Novartis subsidiary.

Novartis said in September that it will cut 2,550 jobs in Switzerland and Britain over four years, as the it strives to boost profits and focus on new medicines. Lu-PSMA-617, which targets PSMA, has shown promising Phase II data.

It is developing Vintafolide, a SMDC that is in Phase IIb clinical trial to treat non-small cell lung cancer; EC1456, which is in Phase I dose escalation trial for the treatment of advanced solid tumors; and EC1169, a tubulysin therapeutic that is in Phase I dose escalation trial to treat advanced metastatic castration-resistant prostate cancer.

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Watch Endocyte and Novartis trade in real time.

According to Endocyte CEO Mike Sherman, "Since acquiring exclusive worldwide rights to develop and commercialize PSMA-617 agents in 2017, the entire Endocyte team, along with our partners, have worked tirelessly to build a leading radioligand (RLT) portfolio and create value for patients and shareholders alike".

Closing of the transaction is subject to customary closing conditions, including the approval of Endocyte's stockholders and receipt of regulatory approvals.

The Endocyte pipeline includes additional investigational RLTs, including 225Ac-PSMA-617 in preclinical studies for the treatment of mCRPC. If it is approved, it would close during the first half of next year.

Endocyte shares were trading up 50 percent to $23.39 in Thursday's pre-market session.

The acquisition of Endocyte is planned to be funded through available cash, it added.

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