Pharma giant Novartis has agreed to acquire Chinook Therapeutics, a drug development and discovery company. The merger is set to take place through a newly established Novartis subsidiary, with the overall transaction amounting to USD 3.5 billion.

Upon the completion of the merger, holders of Chinook common stock will receive USD 3.2 billion in cash (USD 40.00 per share) and a contingent value right of up to USD 0.3 billion (USD 4.00 per share) will be offered upon meeting regulatory milestones. The deal also includes the acquisition of two late-stage assets, atrasentan and zigakibart. The transaction is expected to close in 2H 2023, subject to customary closing conditions.

Chinook Therapeutics specializes in the development of treatments for Immunoglobulin A Nephropathy (IgAN), a progressive kidney disease that predominantly impacts young adults. Its features atrasentan, an oral endothelin A receptor antagonist that is currently undergoing Phase III development for IgAN. Additionally, Chinook Therapeutics is advancing zigakibart, an anti-APRIL monoclonal antibody, into Phase III trials as a potential therapy for the same condition. 

Novartis aims to expand its renal portfolio and address the unmet medical need in treating IgA nephropathy through the acquisition of Chinook Therapeutics. The transaction will provide Novartis with access to Chinook's expertise in kidney disease and its early pipeline targeting severe renal conditions.