Novo Nordisk has agreed to acquire Dicerna Pharmaceuticals for $3.3 billion, the companies said today, in a deal that expands the buyer’s presence into RNA interference (RNAi) therapeutics—three years after the companies began partnering on the technology.
Headquartered in Lexington, MA, Dicerna focuses on discovering, developing and commercializing RNAi-based therapies to silence selectively genes that cause or contribute to disease, using its GalXC™ and GalXC-Plus™ RNAi technologies.
Dicerna’s liver targeted GalXC technology uses liver-targeted GalXC-based compounds to enable subcutaneous delivery of RNAi therapies designed to specifically bind to receptors on liver cells, leading to internalization and access to the RNAi machinery within the cells.
A next-generation version of GalXC, called GHalXC-Plus, extended Dicerna’s capabilities in RNAi silencing to address tissues and organs outside the liver, while retaining key pharmacological features from GalXC.
Dicerna is one of six “Companies to Watch” that were included in GEN’s latest A-List published yesterday, “Top 10 RNA-Based Biopharmas.”
In 2019, Novo Nordisk and Dicerna launched an up-to-$3.8 billion collaboration to discover and develop RNAi therapies using Dicerna’s proprietary GalXC™ RNAi platform technology. The companies’ collaboration encompassed exploring more than 30 liver cell targets, with the potential to deliver multiple clinical candidates for disorders including Novo Nordisk’s forte of type 2 diabetes, as well as chronic liver disease, non-alcoholic steatohepatitis (NASH), obesity, and rare diseases.
In announcing the Dicerna acquisition, Novo Nordisk said it expected to begin clinical development of the first investigational RNAi therapeutic to emerge from the collaboration in 2022.
Novo Nordisk had agreed to pay Dicerna $175 million upfront, as well as make a $50 million equity investment in Dicerna, and pay Dicerna $25 million annually during each of the first three years of the collaboration, contingent on Dicerna delivering RNAi molecules for a defined number of targets.
In addition, Novo Nordisk agreed to pay Dicerna up-to-$357.5 million per target in payments tied to achieving development, regulatory, and commercialization milestones, plus tiered royalties on product sales ranging from the mid-single-digits to mid-teens. With Novo Nordisk intent on developing 10 or more products through the collaboration, its potential total value could top $3.8 billion.
“We build on our successful collaboration,” Marcus Schindler, Executive Vice President and Chief Scientific Officer of Novo Nordisk, said in a statement. “By combining Dicerna’s state-of-the-art RNAi drug engine and intracellular delivery with our deep capabilities in disease biology understanding and tissue targeting through peptides and proteins we have the potential to expand our pipeline and deliver life-changing precision medicines for people living with chronic diseases such as diabetes, obesity, cardiovascular disease and NASH, as well as rare diseases like endocrine disorders and bleeding disorders.”
Investors shared Schindler’s enthusiasm for the acquisition in trading today, sending Dicerna shares soaring nearly 79%, to $38.02 as of 1:07 p.m. from $21.28 at yesterday’s close. Shares of Novo Nordisk on Nasdaq Copenhagen dipped less than 1%, to DKK 752.20 ($115.04) from DKK 753.60 ($115.25).
The deal is expected to close in the fourth quarter.
Through a subsidiary, Novo Nordisk has agreed to begin a tender offer to acquire all outstanding shares of Dicerna common stock at a price of $38.25 per share cash—a premium of 80% to Dicerna’s closing stock price on November 17.
The closing of the tender offer is subject to conditions that include the tender of shares representing at least a majority of the total number of Dicerna’s outstanding shares, the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act and other customary conditions.
Upon the successful completion of the tender offer, Novo Nordisk’s acquisition subsidiary will be merged into Dicerna. Any remaining shares of common stock of Dicerna will be cancelled and converted into the right to receive the same $38.25 per share price payable in the tender offer, the companies said.
The acquisition transaction has been unanimously approved by the boards of Dicerna and Novo Nordisk.
“Since the start of our collaboration two years ago, the Dicerna and Novo Nordisk teams have established a strong rapport built on a foundation of mutual respect for one another’s capabilities, culture and expertise,” said Douglas Fambrough, PhD, Dicerna’s founder, president and CEO. “The combination of Dicerna’s expertise in RNAi and oligonucleotide therapeutics and highly skilled employees with Novo Nordisk’s industry leadership in developing and commercializing medicines to treat serious chronic diseases, has the potential to significantly accelerate and expand our mission to deliver GalXC RNAi therapies for the benefit of patients and all our stakeholders.”