TLDR:
- Lundbeck to acquire Longboard Pharmaceuticals for $2.6 billion
- Deal focuses on Longboard’s epilepsy drug bexicaserin
- Bexicaserin targets rare forms of epilepsy, including Dravet and Lennox-Gastaut syndromes
- Lundbeck estimates peak sales potential of $1.5-2 billion for bexicaserin
- Longboard stock surged over 51% following the announcement
Danish pharmaceutical company Lundbeck has announced its acquisition of San Diego-based Longboard Pharmaceuticals for $2.6 billion, marking the largest deal in Lundbeck’s history.
The acquisition centers around Longboard’s promising epilepsy drug, bexicaserin, which is currently in late-stage development for treating seizures associated with rare forms of epilepsy.
Bexicaserin, Longboard’s lead drug candidate, is an oral medication targeting 5-HT2C receptors and has shown potential in treating seizures related to Developmental and Epileptic Encephalopathies (DEE), including Dravet syndrome and Lennox-Gastaut syndrome. The U.S. Food and Drug Administration has granted bexicaserin a “breakthrough therapy designation,” which could expedite its development and review process.
Lundbeck, known for its focus on brain disorders, sees this acquisition as a strategic move to expand its portfolio of treatments for neurological conditions.
The company estimates that bexicaserin could achieve global peak sales of $1.5 billion to $2 billion, with a projected launch in the fourth quarter of 2028.
The deal values Longboard’s shares at $60 each, representing a 54.2% premium over the stock’s previous closing price. Following the announcement, Longboard’s stock surged by more than 51%, reaching a record high of $58.99.
Charl van Zyl, President and CEO of Lundbeck, expressed enthusiasm about the acquisition, stating,
“This transformative transaction will become a cornerstone in Lundbeck’s neuro-rare franchise, with a potential to drive growth into the next decade.”
He emphasized the critical unmet need that bexicaserin addresses for patients suffering from rare and severe epilepsies.
Longboard’s CEO, Kevin R. Lind, highlighted the potential impact of the deal, noting that Lundbeck’s capabilities will accelerate their vision to provide increased equity and access for underserved DEE patients.
The acquisition is expected to complement Lundbeck’s existing treatments for conditions such as Parkinson’s disease, post-traumatic stress disorder, and migraines. It also aligns with the company’s strategy to strengthen its position in the field of neurology.
Industry analysts view the deal positively, with Wedbush analyst Laura Chico describing the price as “fair but full.” She noted that while Longboard was capable of executing its development program independently, Lundbeck’s strong presence and reputation in central nervous system therapeutics make it a suitable partner.
The transaction has been approved by both companies’ boards of directors and is expected to close by the end of 2024, subject to customary closing conditions and regulatory approvals.
Longboard, founded in 2020 as a spin-off from Arena Pharmaceuticals, has a team of 50 full-time employees. The company is also developing a phase one treatment targeting receptors associated with various neurological diseases, including multiple sclerosis, lupus, Parkinson’s disease, and Alzheimer’s disease.
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