Ra Pharmaceuticals Inc is reportedly in the final-stage trials of a drug expected to treat a rare muscle disease. According to the latest reports, the company has been taken over by Belgium-based UCB for $2.1 billion. That acquisition was applauded by the market, with the Cambridge biotech immediately doubling in value.
Ra Pharma (NASDAQ: RARX) saw its shares explode by 2 p.m. Thursday after that deal was announced. Ra Pharma was founded in 2008, and since then, it has been at the forefront in researching breakthrough treatments for rare diseases.
Terms of the Deal
According to the deal, UCB agreed to pay $48 per share, translating to about $2.5 billion. However, it says that the agreement represents a transaction value of almost $2.1 billion, which is the net of Ra Pharma cash. The biotech company reported having $190 million in total assets as of June 30, 2019.
This deal represents a 93% premium to Ra’s value before the contract, according to official reports from UCB. The Belgian company also said in a statement announcing the deal that it will keep the Cambridge offices of Ra. Moreover, it plans to enhance its presence in the United States, especially by investing in the innovation hub in the Boston area.
The executives of both companies have collectively approved this transaction. However, the Ra Pharma shareholders must approve the transaction for the deal to go through successfully. According to an official unanimous statement, the companies expect the deal to close by March 2020.
Doug Treco, the co-founder of Ra Pharma, is a former co-founder of Transkaryotic Therapies that was acquired by Shire Pharmaceuticals in 2008. Zilucoplan is Ra Pharma’s lead drug candidate. It is intended to become a once-daily injected drug. It is currently in Phase 3 trials development stage as a treatment for generalized myasthenia gravis, or gMG.
According to the company, over 60,000 people in the United States have this chronic autoimmune disease that is known to cause increased muscle weakness. Official reports confirm that Zilucoplan is scheduled to start a Phase 2/3 trial in patients who have amyotrophic lateral sclerosis, or ALS.