In a groundbreaking move, Orchard Therapeutics (ORTX) has struck a momentous buyout deal worth a staggering $478 million with Japan’s Kyowa Kirin.
The announcement, made on Thursday, has sent shockwaves through the stock market, propelling ORTX stock to a remarkable two-year high.
ORTX Stock Skyrockets by 96%
The news of the Kyowa Kirin buyout deal has sent ORTX stock on a meteoric rise, with shares surging by an astonishing 96%.
The stock concluded the regular trading session at an impressive $15.95, positioning it just below the takeover price of $16 per American Depository Share (ADS).
Additional Incentive: FDA Approval Could Add $1 per ADS
In a bid to incentivize the success of Orchard Therapeutics‘ gene therapy for metachromatic leukodystrophy (MLD), Kyowa Kirin has offered an additional payout of $1 per ADS in the event of Food and Drug Administration (FDA) approval.
MLD is a life-threatening genetic ailment that leads to the accumulation of fats in the brain and other parts of the body, resulting in the loss of sensory, motor, and cognitive functions.
It’s noteworthy that Orchard’s MLD gene therapy has already secured approval in Europe.
Orchard’s Chief Executive Officer, Bobby Gaspar, expressed his excitement about the deal, stating, “This is an exciting opportunity designed to accelerate the realization of our shared vision of ending the devastation caused by severe genetic diseases and life-changing value in medical care.”
ORTX Stock Reaches Two-Year High
The impact of this groundbreaking acquisition is undeniable, as ORTX stock reaches its highest point since November 2021. Investors and analysts alike are closely watching the developments surrounding Orchard Therapeutics.
Stem Cell-Based Gene Therapy Portfolio
Orchard Therapeutics boasts a robust pipeline of gene therapies aimed at treating neurological and immunological diseases.
Their innovative approach involves extracting a patient’s own blood stem cells, genetically modifying them, and reintroducing them into the patient, with the goal of addressing the root cause of the disease in a single treatment.
Aside from their MLD gene therapy, Orchard is actively testing a gene therapy for Wiskott Aldrich syndrome, an immune disorder characterized by recurrent infections, autoimmunity, eczema, and severe bleeding episodes.
Gaspar, Orchard’s CEO, envisions that the Kyowa Kirin acquisition will significantly enhance Orchard’s ability to market OTL-200, the MLD gene therapy, in the United States, should it receive FDA approval. In Europe, the drug is marketed as Libmeldy.
A Premium Deal: $16 per ADS
The buyout price of $16 per ADS represents a staggering 144% premium over the 30-day volume-weighted average price of ORTX stock, valuing Orchard Therapeutics at a substantial $387.4 million.
When factoring in the contingent value right of $1 per ADS, the total deal value soars to an impressive $477.6 million.
ORTX Stock Receives High Ratings
Orchard Therapeutics’ stock holds a prestigious position in the market, garnering high ratings, according to IBD Digital. With a nearly perfect Relative Strength Rating of 98, ORTX stock stands out as one of the top 2% performers in terms of 12-month performance.
Investors and industry experts are now eagerly awaiting the next chapter in Orchard Therapeutics’ journey as they work towards innovative solutions for severe genetic diseases.
This groundbreaking deal with Kyowa Kirin could be the catalyst for a transformative era in the field of gene therapy.