Health and Healthcare
Will Medicines Co Be the Next Target of Novartis?
Published:
Last Updated:
Medicines Co. (NASDAQ: MDCO) shares shot up on Tuesday after it was reported that Novartis A.G. (NYSE: NVS) might be eyeing this company as its newest acquisition.
Currently, Medicines has a market cap of $5.5 billion, after seeing shares nearly quadruple in 2019 alone, including Tuesday’s move. With growth like this, Medicines could fetch an even higher price, should it be acquired.
However, this wouldn’t be a problem for Novartis, which boasts a $203 billion market cap and $8.38 billion in cash and cash equivalents on the balance sheet.
Novartis appears to be targeting Medicines for its top drug candidate, a cholesterol-lowering drug for heart patients called inclisiran.
Historically, Novartis has had a strong cardiovascular drug franchise, but the firm lost ground when Diovan, once a $6 billion-per-year seller, lost patent protection in 2012, leaving the company without an immediate, innovative follow-up product.
Apart from this, Novartis has been building up its portfolio, which now includes Entresto, a $1 billion seller for heart failure, as well as an experimental RNA-targeting molecule from Ionis Pharmaceuticals that it licensed earlier this year for $150 million.
Shares of Medicines traded up about 23% to $71.96 Tuesday morning, in a 52-week range of $16.69 to $73.85. The consensus price target is $69.77.
Novartis was relatively flat at $89.98 a share. The 52-week range is $73.54 to $95.00, and the consensus price target is $101.00.
Start by taking a quick retirement quiz from SmartAsset that will match you with up to 3 financial advisors that serve your area and beyond in 5 minutes, or less.
Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests.
Here’s how it works:
1. Answer SmartAsset advisor match quiz
2. Review your pre-screened matches at your leisure. Check out the advisors’ profiles.
3. Speak with advisors at no cost to you. Have an introductory call on the phone or introduction in person and choose whom to work with in the future
Get started right here.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.