TIDMNOVN
-- Over 50 million secondary prevention patients worldwide with
atherosclerotic cardiovascular disease (ASCVD) or familial
hypercholesterolemia (FH) on current standard of care do not achieve LDL
cholesterol (LDL-C) goal and remain at increased risk of cardiovascular
events1
-- First-in-class siRNA biological mechanism enables unique twice-yearly,
subcutaneous dosing regimen and seamless integration into routine
healthcare professional visits, potentially improving adherence and
patient outcomes2,3,4
-- Comprehensive Phase III inclisiran program showed potent and durable
reduction of >50% in LDL-C on top of standard of care, with excellent
safety profile2,3,4
-- Transaction expected to create significant value with soon-to-launch,
potentially first-in-class product that could become one of the largest
products by sales in Novartis portfolio, leveraging significant synergies
with existing global cardiovascular commercial capabilities
-- Highly efficacious, safe and convenient profile of inclisiran combined
with flexible market access strategies and value-based pricing can enable
broad access
-- Offer price of USD 85.00 per share in cash represents a premium of
approximately 41% over The Medicines Company's 30-day volume weighted
average price of USD 60.33; valuing the company at approximately USD 9.7
billion on a fully diluted basis
-- Novartis updates Innovative Medicines (IM) Division core margin outlook;
now expects to achieve mid-thirties in the near term and mid-to-high
thirties in the medium term
Basel, November 24, 2019 -- Novartis CEO Vas Narasimhan said:
"We are excited about entering into an agreement to acquire The
Medicines Company as inclisiran is a potentially transformational
medicine that reimagines the treatment of atherosclerotic heart disease
and familial hypercholesterolemia. With tens of millions of patients at
higher risk of cardiovascular events from high LDL-C, we believe that
inclisiran could contribute significantly to improved patient outcomes
and help healthcare systems address the leading global cause of death.
The prospect of bringing inclisiran to patients also fits with our
overall strategy to transform Novartis into a focused medicines company
and adds an investigational therapy with the potential to be a
significant driver of Novartis' growth in the medium to long term."
Novartis announced today that it has entered into an agreement and plan
of merger with The Medicines Company (NASDAQ: MDCO) to acquire the
US-based biopharmaceutical company for USD 85.00 per share in cash,
valuing the company at approximately USD 9.7 billion on a fully diluted
equity basis. The offer price represents a premium of approximately 41%
over The Medicines Company's 30-day (to November 22, 2019) volume
weighted average price of USD 60.33 and approximately 24% premium over
The Medicines Company's closing share price of USD 68.55 on November 22,
2019 which represented a fully diluted equity value of approximately USD
7.7 billion when including the impact of outstanding stock options and
convertible debt. The transaction has been unanimously approved by the
Boards of Directors of both companies.
The Medicines Company recently announced data from its comprehensive
clinical program consisting of three Phase III trials (ORION-9, 10 and
11) for inclisiran involving over 3,600 high-risk patients with ASCVD
and FH. In all trials, inclisiran demonstrated potent and durable LDL-C
reduction with an excellent safety and tolerability profile(2,3,4) .
Furthermore, inclisiran's potentially first-in-class, twice-yearly
dosing schedule allows administration during patients' routine visits to
their healthcare professionals and will likely contribute to improved
patient adherence and sustained, lower LDL-C levels(2,3,4) . The
Medicines Company expects to file regulatory submissions in the U.S. in
the fourth quarter of 2019 and in Europe in the first quarter of 2020.
An ongoing clinical trial (ORION-4) will evaluate the cardiovascular
morbidity and mortality benefits of inclisiran(5) .
"Novartis has a longstanding history of delivering breakthrough
cardiovascular treatments for patients, and I am very excited about the
opportunity to add inclisiran to our cardiovascular portfolio," said
Marie-France Tschudin, President, Novartis Pharmaceuticals. "This
transformational, new investigational medicine has the potential to
meaningfully address one of the largest areas of underserved patient
need. We believe our strong capabilities and global footprint can help
drive broad worldwide access to this much needed treatment."
Transaction fits long-term strategic goals
The planned acquisition of The Medicines Company would allow Novartis to
continue building pipeline depth in a key therapeutic area -- a central
pillar of its M&A strategy -- and is aligned with the Novartis strategic
priority of delivering truly transformational medicines for patients. It
would add a potentially first-in-class siRNA inhibitor targeting PCSK9
with the potential to fundamentally change the treatment of elevated
LDL-C in high risk patients(2,3,4) . Additionally, with The Medicines
Company expecting to file regulatory submissions in the U.S. in the
fourth quarter of 2019 and in Europe in the first quarter of 2020,
inclisiran represents a near-term product launch opportunity and is
expected to contribute to Group sales from 2021. Furthermore, broadening
the cardiovascular portfolio would enable Novartis to leverage its core
commercial capabilities including its strong cardiovascular field force
both in the US and globally. Finally, the transaction is consistent with
Novartis' capital allocation priorities to invest in transformative
innovation and long term value creation for shareholders.
Financial highlights and updated IM Division margin outlook guidance
The offer price represents a premium of approximately 41% over The
Medicines Company's 30-day volume weighted average price of USD 60.33
and approximately 24% premium over The Medicines Company's closing share
price of USD 68.55 on November 22, 2019 which represented a fully
diluted equity value of approximately USD 7.7 billion when including the
impact of outstanding stock options and convertible debt.
The transaction is expected to create significant value for patients,
payers and Novartis shareholders. Assuming completion in the first
quarter of 2020, Novartis expects inclisiran to start to contribute to
Group and IM Division sales from 2021. It is also expected to further
drive growth of the Cardiovascular-Renal-Metabolism franchise with the
potential to become one of the largest products by sales in the Novartis
portfolio, leveraging Novartis' global cardiovascular commercial
capabilities.
The acquisition is expected to modestly dilute core EPS versus a no deal
scenario during the next few years as the company invests for a
successful launch of inclisiran. Novartis expects the transaction to be
significantly accretive to Group core operating income and core EPS in
the medium term, driven by sales growth and operational synergies,
leveraging the worldwide footprint of the cardiovascular business.
Novartis expects to continue to expand IM Division core margins to reach
mid-thirties in the near term, and mid to high-thirties in the medium
term, while investing in launches, including inclisiran. This guidance
assumes that no Gilenya(R) generics will enter the US market in 2020.
The core margin expansion for IM Division is driven by the continued
sales momentum of key growth drivers, expected new launches as well as
previously announced productivity programs. Novartis believes these
factors will offset investments in new launches including inclisiran as
well as the impact of generic erosion.
Transaction details
The transaction is expected to close in the first quarter of 2020,
subject to the satisfaction or waiver of all closing conditions. Until
closing, Novartis and The Medicines Company will continue to operate as
separate and independent companies.
Under the terms of the agreement and plan of merger, Novartis will,
through a subsidiary, commence a tender offer to purchase all
outstanding shares of The Medicines Company for USD 85.00 per share in
cash. Following completion of the tender offer, Novartis expects to
merge the acquiring subsidiary with The Medicines Company, resulting in
The Medicines Company becoming an indirect wholly-owned subsidiary of
Novartis. The transaction is subject to customary closing conditions,
including antitrust clearance.
Novartis plans to finance the transaction through available cash and
short- and long-term borrowings.
Investor call
A conference call for investors will take place on November 25, 2019 at
7:00 CET. Details can be found at
https://www.novartis.com/investors/event-calendar.
Additional information
This press release is neither an offer to purchase nor a solicitation of
an offer to sell securities. The tender offer for the outstanding shares
of common stock, par value USD 0.001, of The Medicines Company (the
"Company") described in this press release has not commenced. At the
time the tender offer is commenced, Novartis and its indirect
wholly-owned subsidiary,
Medusa Merger Corporation ("Purchaser"), will file, or will cause to be
filed, a Schedule TO Tender Offer Statement with the U.S. Securities and
Exchange Commission (the "SEC") and the Company will file a Schedule
14D-9 Solicitation/Recommendation Statement with the SEC, in each case
with respect to the tender offer. The Schedule TO Tender Offer Statement
(including an offer to purchase, a related letter of transmittal and
other offer documents) and the Schedule 14D-9
Solicitation/Recommendation Statement will contain important information
that should be read carefully when they become available and considered
before any decision is made with respect to the tender offer. Those
materials and all other documents filed by, or caused to be filed by,
Novartis and Purchaser and the Company with the SEC will be available at
no charge on the SEC's website at www.sec.gov. The Schedule TO Tender
Offer Statement and related materials also may be obtained for free
under the "Investors -- Financial Data" section of Novartis website at
https://www.novartis.com/investors/financial-data/sec-filings. The
Schedule 14D-9 Solicitation/Recommendation Statement and such other
documents also may be obtained for free from the Company under the
"Investors & Media" section of the Company's website at
https://www.themedicinescompany.com/investor/financial/.
About Novartis in Cardiovascular-Renal-Metabolism
Bending the curve of life requires addressing some of society's biggest
public health concerns. Novartis has an established and expanding
presence in diseases covering the heart, kidney and metabolic system. In
addition to essential treatment Entresto(R) (sacubitril/valsartan),
Novartis has a growing pipeline of potentially first-in-class molecules
addressing genetic cardiovascular risk factors, rare renal diseases and
metabolic disorders.
About atherosclerotic cardiovascular disease
Atherosclerotic cardiovascular disease is the leading cause of death
worldwide(6) . ASCVD results from a thickening and loss of elasticity in
the arterial wall. It is a severe disorder and the leading cause of
morbidity (sickness) and mortality (death) in most developed
countries(7) . High levels of LDL-C build up on the walls of blood
vessels. This buildup is called "plaque." As blood vessels build up
plaque over time, the insides of the vessels narrow. This narrowing
blocks blood flow to and from the heart and other organs and eventually
causes heart disease or stroke(8) .
About familial hypercholesterolemia
Familial hypercholesterolemia (FH) is a genetic condition that leads to
high cholesterol. People with FH have high levels of LDL-C as a result
of a mutation in one gene that controls the way cholesterol is cleared
by the body. High levels of LDL-C build up on the walls of the blood
vessels and over time, the vessels narrow. This can lead to increased
risk of heart attack or stroke. While lifestyle factors are important,
for people with FH this isn't sufficient to control LDL-C(9) .
About inclisiran
Inclisiran, potentially the first and only cholesterol-lowering therapy
in the siRNA (small-interfering RNA) class, is The Medicines Company's
investigational twice-yearly therapy in Phase III clinical development
to evaluate its ability to reduce low-density lipoprotein cholesterol
(also known as LDL-C). As a siRNA, inclisiran harnesses the body's
natural process of RNA interference to specifically prevent production
of the PCSK9 protein in the liver, which enhances the liver's ability to
remove LDL-C from the bloodstream, thereby lowering LDL-C levels(2,3,4)
. Inclisiran is not yet approved by the FDA or any other regulatory
authority. The Medicines Company obtained global rights to develop,
manufacture and commercialize inclisiran under a license and
collaboration agreement with Alnylam Pharmaceuticals, Inc. On January
23, 2018, the FDA granted orphan drug designation to inclisiran for the
treatment of homozygous familial hypercholesterolemia (HoFH)(10) .
About ORION clinical development program
Durable and potent LDL-C reduction with twice-yearly administration was
demonstrated in three pivotal Phase III trials. ORION-11: showed a 54%
LDL-C lowering with time-adjusted reductions of 50% sustained over 18
months of treatment(2) . ORION-10: showed a 58% (observed) LDL
cholesterol lowering with time-adjusted reductions of 56% sustained over
18 months. ORION-10 met all primary and secondary endpoints, with
profound, durable efficacy and excellent safety of inclisiran that were
at least as favorable as observed in ORION-11(3,4) . ORION-9: met all
primary and secondary efficacy endpoints, including durable and potent
efficacy and excellent safety in a patient population where
cardiovascular disease is most severe(4) .
In addition, inclisiran has a highly attractive dosing regimen. After an
initial 3-month lead in, twice-yearly subcutaneous dosing thereafter
applicable to all tested patients and subgroups. A clean long-term
safety profile across a broad range of patient groups was observed. The
benefit of inclisiran on cardiovascular outcomes is being assessed in an
on-going 15 000 patient 5-year clinical trial (ORION-4)(5) .
Disclaimer
This press release contains forward-looking statements within the
meaning of the United States Private Securities Litigation Reform Act of
1995, that can generally be identified by words such as "to be commenced,
" "to purchase," "to acquire," "to transform," "potential," "expected,"
"offers," "future," "ongoing," "would," "potentially," "believe," "can,"
"hopefully," "excited," "ambition," "priorities," "confidence," "to
strengthen," "opportunity," "pending," "will," "expects," "subject to,"
"planned," "soon to launch," "transformational" or similar expressions,
or by express or implied discussions regarding the potential outcome of
the tender offer for the shares of The Medicines Company to be commenced
by Novartis, and the potential impact on Novartis of the proposed
acquisition, including express or implied discussions regarding
potential future sales or earnings of Novartis, and any potential
strategic benefits, synergies or opportunities expected as a result of
the proposed acquisition; and regarding potential marketing or
regulatory approvals for inclisiran, or regarding potential future
revenues from such product. You should not place undue reliance on
these statements. Such forward-looking statements are based on our
current beliefs and expectations regarding future events, and are
subject to significant known and unknown risks and uncertainties.
Should one or more of these risks or uncertainties materialize, or
should underlying assumptions prove incorrect, actual results may vary
materially from those set forth in the forward-looking statements.
There can be no guarantee that the proposed tender offer or the
acquisition described in this press release will be completed, or that
it will be completed as currently proposed, or at any particular time.
Neither can there be any guarantee that Novartis or The Medicines
Company's product, inclisiran, will achieve any particular future
financial results, or that Novartis will be able to realize any of
potential strategic benefits, synergies or opportunities as a result of
the proposed acquisition. Nor can there be any guarantee that
inclisiran will be submitted or approved for sale in any market, or at
any particular time. Neither can there be any guarantee that such
product will be successfully commercialized even if regulatory approvals
are obtained. In particular, our expectations could be affected by,
among other things: regulatory actions or delays or government
regulation generally, including potential regulatory actions or delays
relating to the completion of the potential acquisition described in
this release, as well as potential regulatory actions or delays with
respect to the development of inclisiran; the potential that the
strategic benefits, synergies or opportunities expected from the
proposed acquisition may not be realized or may take longer to realize
than expected; the successful integration of The Medicines Company into
the Novartis Group subsequent to the closing of the transaction and the
timing of such integration; potential adverse reactions to the proposed
transaction by customers, suppliers or strategic partners; dependence on
key personnel of The Medicines Company; dependence on third parties to
fulfill manufacturing and supply obligations; the uncertainties inherent
in the research and development of new healthcare products, including
clinical trial results and additional analysis of existing clinical
data; our ability to obtain or maintain proprietary intellectual
property protection; safety, quality, data integrity or manufacturing
issues; global trends toward health care cost containment, including
government, payer and general public pricing and reimbursement pressures
and requirements for increased pricing transparency; the particular
prescribing preferences of physicians and patients; uncertainties
regarding actual or potential legal proceedings, including, among others,
potential legal proceedings with respect to the proposed acquisition;
and other risks and factors referred to in Novartis' current Form 20-F
on file with the SEC. Novartis is providing the information in this
press release as of this date and does not undertake any obligation to
update any forward-looking statements as a result of new information,
future events or otherwise.
About Novartis
Novartis is reimagining medicine to improve and extend people's lives.
As a leading global medicines company, we use innovative science and
digital technologies to create transformative treatments in areas of
great medical need. In our quest to find new medicines, we consistently
rank among the world's top companies investing in research and
development. Novartis products reach more than 750 million people
globally and we are finding innovative ways to expand access to our
latest treatments. About 109,000 people of more than 140 nationalities
work at Novartis around the world. Find out more at
www.novartis.com.
Novartis is on Twitter. Sign up to follow @Novartis at
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References
1. Novartis. Data on file
2. Raal FJ et al. Safety and Efficacy of Inclisiran in Patients With
Heterozygous Familial Hypercholesterolemia. Data presented at: AHA
Scientific Sessions 2019, Nov 16-18; Philadelphia, USA.
3. Wright RS et al. Inclisiran for subjects with ASCVD and elevated
low-density lipoprotein cholesterol. Data presented at: AHA Scientific
Sessions 2019, Nov 16-18; Philadelphia, USA
4. Ray K et al. Impact of inclisiran on LDL-C over 18 months in patients
with ASCVD or risk-equivalent. Data presented at: European Society of
Cardiology Congress, Aug 29 -- Sept 2; Paris, France
5. A Randomized Trial Assessing the Effects of Inclisiran on Clinical
Outcomes Among People With Cardiovascular Disease (ORION-4). Available
at: https://clinicaltrials.gov/ct2/show/NCT03705234. Last accessed:
November 19, 2019.
6. Barquera et al. Global Overview of the Epidimiology of Atherosclerotic
Cardiovascular Disease. Arch Med Res. 2015 Jul;46(5):328-38.
7. Canadian Heart Patient Alliance. What is ASCVD. Available at:
http://www.heartpatientalliance.ca/general-information/types-of-cardiovascular-disease/what-is-ascvd/.
Last accessed: November 19, 2019.
8. Centers for Disease Control and Prevention. LDL and HDL Cholesterol:
"Bad" and "Good" Cholesterol. Available at:
https://www.cdc.gov/cholesterol/ldl_hdl.htm. Last accessed: November 19,
2019.
9. Familial Hypercholesterolemia Foundation. What is Familial
Hypercholesterolemia. Available at:
https://thefhfoundation.org/familial-hypercholesterolemia/what-is-familial-hypercholesterolemia.
Last accessed: November 19, 2019.
10. US Food and Drug Administration. Available at:
https://www.accessdata.fda.gov/scripts/opdlisting/oopd/detailedIndex.cfm?cfgridkey=618017.
Last accessed: November 19, 2019.
# # #
Novartis Media Relations
E-mail: media.relations@novartis.com
Anja von Treskow Meghan O'Donnell
Novartis External Communications Global Head, Cardio-Renal-Metabolism Communications
+41 61 324 2279 (direct) and Patient Advocacy
+41 79 392 8697 (mobile) +41 61 324 9136 (direct)
anja.von_treskow@novartis.com +41 79 797 9102 (mobile)
meghan.odonnell@novartis.com
Eric Althoff
Novartis US Communications
+1 646 438 4335 (mobile)
eric.althoff@novartis.com
Novartis Investor Relations
Central investor relations line: +41 61 324 7944
E-mail: investor.relations@novartis.com
Central North America
Samir Shah +41 61 324 7944 Sloan Simpson +1 862 778 5052
Pierre-Michel Bringer +41 61 324 1065
Thomas Hungerbuehler +41 61 324 8425
Isabella Zinck +41 61 324 7188 Cory Twining +1 862 778 3258
(END) Dow Jones Newswires
November 24, 2019 15:00 ET (20:00 GMT)
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