Novartis will pay $800 million (£604 million) for Gyroscope Therapeutics now and has the potential to make additional milestone payments of up to $700 million (£528 million).
Gyroscope, founded in 2016, develops gene therapies to treat eye issues. The company has developed the world’s first treatment for geographic atrophy (GA), an advanced form of dry age-related macular degeneration that leads to blindness.
Marie-France Tschudin, president of Novartis Pharmaceuticals, said: “With our own pioneering research in ocular gene therapies and our experience gained from bringing Luxturna to inherited retinal dystrophy patients outside of the US, Novartis has a well-established expertise in ocular gene therapies that will position us well to continue developing this promising one-time treatment.
“This acquisition is one more step forward in our commitment to delivering innovation in ophthalmology to treat and prevent blindness worldwide.”
Khurem Farooq, CEO of Gyroscope, said: “I’m incredibly proud of the progress the Gyroscope team has made in developing what we hope may be the first gene therapy for a leading cause of blindness.
“Joining forces with Novartis will greatly enhance our ability to deliver on our promise by providing additional expertise and resources to expand our development programme for GT005 and realise the potential of our exciting pipeline.”
Gyroscope was cofounded by Syncona Investment Management, a London-listed company that specialises in developing life sciences businesses. Syncona said the sale to Novartis delivered a 55% return on its investment in the project. The sale should bring in £334 million of cash when the deal closes.
Chris Hollowood, chief investment officer of Syncona, said: “In five and a half years, enabled by collaborations with four leading UK universities, we have taken Gyroscope from a concept to a potential treatment for geographic atrophy secondary to AMD, a leading cause of blindness with no approved therapies.
“Gyroscope is now an international company with world-class management, positive clinical data, proprietary surgical and manufacturing platforms, and a team of nearly 200 people.
“The structure of the transaction will provide us with ongoing exposure to Gyroscope’s development and the potential for significant additional returns, subject to certain milestones. We look forward to seeing Gyroscope fulfil its potential during the next phase of its growth with Novartis, who have an extensive track record in gene therapy and ophthalmology and are ideally placed to complete the journey of taking this transformational therapy to patients.”
Shares in Syncona rose 17p, or 8.5%, to 217p. Novartis was 0.3p, or 0.1%, lower at 79.08p in Zurich.