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© Reuters.
By Scott Kanowsky
Investing.com -- Shares in CinCor Pharma Inc (NASDAQ:CINC) surged by more than 133% in pre-market trading on Monday after AstraZeneca PLC (LON:AZN) agreed to acquire the U.S. biotech in a deal worth as much as $1.8 billion.
In a statement, AstraZeneca said it will put forward a tender offer in cash of $26 per CinCor's outstanding shares, representing a 121% premium to the firm's closing price on Friday. The transaction will also include a non-tradable contingent value right of $10 per share in cash, which will be payable upon a "specified regulatory submission" of CinCor's baxdrostat blood pressure medication.
The combined value of both the upfront and maximum potential contingent payments, if met, comes to about $1.8B, 206% more than CinCor's Friday closing price.
The move will also see the Anglo-Swedish AstraZeneca - which is keen to expand its pipeline of treatments for heart and kidney disorders - snap up approximately $522M in cash and marketable securities on CinCor's balance sheet.
The Massachusetts-based CinCor saw its share price fall sharply in November when phase 2 clinical trials of baxdrostat, a novel drug designed to lower blood pressure, found that it did not show significant results in patients suffering from uncontrolled hypertension.
But AstraZeneca said that the drug complements its strategy to provide more treatments for cardiorenal diseases, an area that it believes has a "high unmet medical need." The company added that baxdrostat could be combined with its chronic kidney disease drug Farxiga.
"Excess levels of aldosterone are associated with hypertension and several cardiorenal diseases, including chronic kidney disease and coronary artery disease and being able to effectively reduce this would offer a much-needed treatment option for these patients," said Mene Pangalos, executive vice president of biopharmaceuticals research and development at AstraZeneca.
London-listed shares in AstraZeneca edged lower following the announcement.
Big pharmaceutical groups like AstraZeneca are expected to unveil a raft of acquisitions in 2023 after macroeconomic headwinds held back dealmaking last year. Analysts at consultancy firm PwC have estimated that merger activity will amount to $225B - $275B this year, as drugmakers move to take advantage of ample cash piles and a drop in biotech valuations to address treatment pipeline gaps.
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