By Siddhi Mahatole
June 1 (Reuters) – Edgewise Therapeutics said on Monday it would sell its experimental muscular dystrophy drug and related business to France’s Servier for up to $2.65 billion.
Shares of the U.S.-based biotech firm surged 17% in morning trading.
The French drugmaker will secure global rights to the Edgewise’s candidate, sevasemten, along with associated intellectual property, clinical data and staff supporting the program for $1.55 billion in upfront cash. Edgewise will also be eligible for up to $1.1 billion in milestone payments, the U.S-based company said.
Edgewise was testing sevasemten in Becker and Duchenne muscular dystrophy, with trials showing muscle function benefits in Becker patients and reductions in muscle damage markers, alongside a favourable safety profile in trials.
Both conditions are genetic disorders that cause progressive muscle weakness, with Becker being a milder form of Duchenne. While Duchenne has several drugs and Sarepta Therapeutics’ gene therapy, Elevidys, Becker has no approved treatments.
The deal removes a key overhang and shifts investor focus to its cardiology pipeline, which is seen as the stock’s main driver, making the positive share reaction “unsurprising,” Leerink Partners analyst Joseph Schwartz said.
The sale, expected to close in the third quarter, would also strengthen Edgewise’s balance sheet, with the company planning to use the proceeds for development of lead candidate EDG-7500.
The drug is being tested for hypertrophic cardiomyopathy, a condition that thickens the heart muscle and makes it harder to pump blood, with 12-week data from its mid-stage trial expected in the second quarter.
Truist analyst Srikripa Devarakonda said investor focus was largely on the hypertrophic cardiomyopathy program.
Sevasemten was “either under the radar or met with skepticism,” Devarakonda added, and estimated peak sales of the drug for Becker muscular dystrophy at about $521 million on an adjusted basis and $1.04 billion on an unadjusted basis.
(Reporting by Siddhi Mahatole in Bengaluru; Editing by Leroy Leo)
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