BioMarin Pharmaceutical has agreed to buy Amicus Therapeutics in a $4.8 billion deal that would hand it two marketed drugs for rare diseases and a third asset in late-stage human testing.
The all-cash acquisition, announced Friday, has BioMarin paying $14.50 for each Amicus share, or a 33% premium to the latter’s closing stock price on Thursday. The deal has unanimous support from the boards of both companies, and should close sometime between April and June next year.
BioMarin expects Amicus’ medicines to increase its long-term revenue growth through 2030 and beyond. One of them, Galafold, is used to treat “Fabry disease,” a genetic, potentially life-threatening illness in which the body can’t break down certain fats, causing them to accumulate in — and ultimately damage — blood vessels and organs. First approved in 2018, Galafold generated $371 million in revenue for Amicus over the first nine months of this year.
In that same period, Amicus recorded $77 million from its second marketed product: a combination of the drugs Pombiliti and Opfolda. The Food and Drug Administration cleared this pairing in 2023 for “late-onset Pompe disease,” another inherited disorder characterized by a toxic buildup of molecules. With Pompe, the body doesn’t make enough of an enzyme needed to process glycogen, which then leads to severe muscle weakness and a host of health problems.
The Amicus acquisition, should it close, would bring BioMarin’s list of marketed therapies to 10 — a monumental feat seldom seen outside of big pharmaceutical firms. The company reported $2.3 billion in net product revenue from January through September, an 11% increase year over year. The majority of that money came from the “Enzyme Therapies Business Unit” that Amicus’ drugs will be folded into.
BioMarin’s portfolio could grow bigger still, as Amicus has a potentially first-of-its-kind treatment for an uncommon kidney disease known, in short, as FSGS.
Amicus is an “exceptional strategic fit,” BioMarin CEO Alexander Hardy said in a statement, adding that his team expects the deal to be accretive to non-GAAP diluted earnings per share within a year of its closing. Amicus’ top executive, Bradley Campbell, also contends his company’s medicines will get to more patients faster thanks to BioMarin’s greater resources and scale.
Alongside the deal announcement, Amicus disclosed that it has resolved patent litigation related to Galafold with the companies Aurobindo Pharma and Lupin. Amicus now doesn’t anticipate generic versions of the drug to hit the U.S. market until early 2037.
On Wall Street, analysts argued the deal makes sense for BioMarin. Investors appear to agree. The company’s share price, which has been suppressed since early April, shot back up roughly 19% on Friday, to reach just north of $62 by mid-morning.
Yet, while the strategic fit is “obvious,” there remains some risk, according to Stifel analyst Paul Matteis. The acquisition is “fairly large” by BioMarin’s standards, and therefore represents a “pretty big bet on the value of diversification, and the peak sales potential of [Amicus’] two key assets, which will be debated by investors.” To finance the deal, BioMarin is using a combination of cash and $3.7 billion worth of non-convertible debt.
“As we see it, this does improve the [BioMarin] narrative,” Matteis wrote in a note to clients, explaining that investors have “little else to talk about” other than competition to the company’s top seller Voxzogo — a topic on which they’ve become “overwhelmingly focused.” Given that BioMarin had become “one of the more out-of-favor stocks in our universe, it's unsurprising to see shares trade modestly higher here.”
In his own note, Dennis Ding of Jefferies wrote that his team isn’t very concerned the Federal Trade Commission will take issue with this deal.
Another bidder could arise, Ding added, though it's unlikely that challenger would be a larger pharmaceutical player due to Amicus’ sparse research pipeline and “clinical upside.” The main attraction, rather, is the company starting to be profitable thanks to its growing revenue and stable operating expenses.
