SAN FRANCISCO ― Two small Massachusetts biotech companies will be acquired by large European drug developers, the firms said Monday, marking a modest start to what has historically been one of the busiest weeks for announcing biotech acquisitions and partnerships.
British pharmaceutical giant AstraZeneca plans to pay about $1.3 billion to acquire Waltham-based CinCor and its experimental hypertension pill, which is in intermediate-stage clinical trials. And French drugmaker Ipsen plans to acquire Cambridge-based Albireo for about $952 million. Abireo has a drug that treats a rare liver disease.
AstraZeneca and Ipsen will both pay more than twice as much as each company’s stock was worth when markets closed on Friday.
The deals were announced as the biotech industry’s largest annual business meeting kicked off in San Francisco on Monday morning, which is being held in person for the first time since 2020 following a three-year hiatus due to the pandemic.
An air of gloom has surrounded the biotech industry as executives, investors, and entrepreneurs descended on the city for the J.P. Morgan Healthcare Conference. Last year was one of the toughest in recent history for the sector. The stock price of many small biotechs lost 80 to 90 percent of their value. Meantime, the number of merger and acquisition deals in the life sciences sector fell by about 45 percent in 2022 compared with the year prior, according to a recent report from Deloitte.
“Biotech stocks have been depressed, but I think it [the acquisition] shows that if you have a good drug and a good team, you can create value for shareholders,” said CinCor chief executive Marc de Garidel in an interview. “Big pharma is in a good position to pick what they want these days because valuations are down. And they seem to be pretty picky on what they want.”
The CinCor acquisition came at a 121 percent premium to its stock price on Friday and a 75 percent premium to its price in January when the company went public. The tiny firm, which has 22 employees, could earn an additional $500 million from AstraZeneca if the drug for treatment-resistant hypertension is submitted to federal regulators for approval in the coming years.
The Albireo acquisition came at a 104 percent premium to its stock price on Friday. Ipsen said the purchase was focused on Albireo’s drug Bylvay, which was approved in July 2021 for treating an inherited liver disease called progressive familial intrahepatic cholestasis, which if left untreated, can cause cirrhosis and liver failure by age 10. The company is testing the drug in two other liver diseases. Albireo didn’t immediately respond to a request for comment.
Garidel said the CinCor acquisition will accelerate the development of its drug baxdrostat, which the company plans to begin testing in an advanced clinical trial of people with treatment-resistant hypertension later this year. “AstraZeneca is a powerhouse in cardiorenal disease and they can take baxdrostat to the next level,” he said. Results of that advanced trial could come as early as late 2024, he added.
About 116 million Americans have hypertension, according to the Centers for Disease Control and Prevention. CinCor said estimates that 13 to 15 million of those people have treatment-resistant hypertension.
“These are patients who have been on three blood pressure drugs and are not yet on goal,” Garidel said. “They are at risk of stroke, or heart attack or even near potentially death. So they need to have other options.”
Baxdrostat has the net effect of lowering blood pressure by blocking the production of a hormone called aldosterone, which regulates salt and water in the body. Cincor also has intermediate-stage trials testing the drug in people with high blood pressure that is “inadequately treated,” a population that the company estimates to be up to 35 million Americans.
CinCor is also testing baxdrostat in people who have both hypertension and chronic kidney disease. Garidel said that AstraZeneca is also excited about testing baxdrostat in combination with the pharma company’s approved drug Farxiga to better treat chronic kidney disease patients.