Roche has obtained a nonexclusive license to Alnylam Pharmaceuticals’ RNAi platform in a deal valued at over $1 billion plus royalties. Alnylam shares skyrocketed over 53% to open trading today at $23.29.
Roche’s upfront payment to Alnylam is valued at $331 million in cash plus an equity investment of just less than 5% of the company’s outstanding common stock. Roche Venture Fund will pay $21.50 per share, representing a premium of more than 44% over Alnylam’s closing price on Friday, July 6. Development and commercialization milestone fees as well as field expansion payments could bring Alnylam’s earnings up to $1 billion. The company will also receive royalties.
The deal will initially cover oncology, respiratory diseases, metabolic diseases, and certain liver diseases. The firms will collaborate on drug discovery for one or more disease targets in these therapeutic areas. Additionally, Roche plans to acquire Alnylam's research site in Kulmbach, Germany. This facility will become Roche's Center of Excellence for RNAi therapeutics discovery.
This transaction is part of Roche’s aggresive expansion of its therapeutic and diagnostic businesses this year through collaborations and acquisitons. The company picked up four diagnostic companies at a total value of over $4 billion and an antibody research firm for another $56.5 million.
Under Alnylam existing contract with Isis Pharmaceuticals, the latter company will receive $26.5 million upfront as well as milestone fees and royalties. The 2004 deal gave Alnylam an exclusive license to Isis' intellectual property for double-stranded oligonucleotide therapeutics that mediate RNAi.