Swiss pharmaceutical company Novartis (NYSE:NVS) has announced the acquisition of German biopharmaceutical company MorphoSys AG (NASDAQ:MOR) for €68 per share for a total of €2.7 billion ($2.9 billion) in cash. Shares of Morphosys ticked higher in pre-market trading and have surged more than 50% over the past five trading sessions.
Novartis has made this acquisition to expand its oncology pipeline and enhance its global presence in hematology. As a part of this acquisition, the company will own pelabresib (CPI-0610), which is used to treat myelofibrosis (a type of bone marrow cancer), and tulmimetostat (CPI-0209). Tulmimetostat (CPI-0209) is currently being tested in patients with solid tumors or lymphomas.
However, this transaction is subject to regulatory clearance and a minimum acceptance threshold of 65% from shareholders. The deal is expected to close in the first half of this year.
Is Morphosys a Buy or Sell?
Morphosys stock has soared by more than 200% over the past year. Overall, analysts remain bullish about MOR stock, with a Moderate Buy consensus rating based on three Buys and two Holds. The average MOR price target of $13.23 implies a downside potential of 17.8% from current levels if the acquisition falls through.
