Novartis Reportedly Eyeing Acquisition of The Medicines Company for PCSK9 RNAi Therapy Inclisiran

News Event

Bloomberg News reported today that Novartis may acquire The Medicines Company, the developer of inclisiran, a PCSK9 RNAi therapeutic, driving MDCO’s stock up by 20% today. This information has not been confirmed by either company and remains speculative. At the recently concluded American Heart Association (AHA) Scientific Sessions, The Medicines Company presented detailed results from two Phase III clinical trials of inclisiran, ORION-9 and ORION-10, confirming its potent lipid-lowering efficacy with twice-yearly dosing. In patients with atherosclerosis and heterozygous familial hypercholesterolemia, inclisiran achieved additional LDL-C reductions of 58% and 50%, respectively, compared with placebo on top of standard therapy over a 17-month observation period. The Medicines Company plans to submit an application for U.S. market approval this year and seeks European approval next year.

Drug Source Analysis

This rumor is not entirely baseless. Previously, Novartis announced its intention to pursue an acquisition valued at $5–10 billion, while The Medicines Company (MDCO) had a market capitalization of $4.7 billion as of yesterday. In addition to Entresto, Novartis’s cardiovascular portfolio requires another blockbuster product. Its strategic partnership with Akcea, another RNA-focused company, in 2016 also demonstrated Novartis’s strong interest in entering the RNA therapeutics space. Novartis is considered relatively forward-thinking among major pharmaceutical companies in tracking cutting-edge technologies. Beyond its foray into RNA therapies, it has launched the SMA gene therapy Zolgensma and the first CAR-T cell therapy, Kymriah, over the past two years. Its successive acquisitions of targeted radioligand therapy developer Endocyte and AAA (referred to as AAAP in the source text) further underscore its distinctive strategy.

RNA interference (RNAi) was discovered only in 1998, yet it garnered the Nobel Prize in 2006 and saw its first drug, Onpattro, hit the market in 2018. Previously, nucleic acid therapeutics were pursued only for ultra-rare diseases with no other treatment options; however, times have changed, and these therapies are poised to become accessible to the general public. The greatest advantage of RNA therapeutics is their convenience of administration; for instance, inclisiran requires only one injection every six months. In contrast, small-molecule drugs typically require once-daily dosing. Although this frequency aligns with many daily routines (such as brushing teeth), theoretically ensuring good adherence, it remains a significant barrier to compliance in the real world. While antibody drugs can be administered via injection every few weeks, they are associated with higher costs. Furthermore, because the quality of antibody drugs is highly dependent on the manufacturing process, biosimilars struggle to enter the market in a timely manner. For example, despite Botox’s patent expiring many years ago, not a single biosimilar has been approved, let alone entered into competition, representing a waste for society as a whole. Although the production of RNA therapeutics is also highly challenging, their replicability is likely superior to that of antibody drugs.

The Medicines Company (MDCO) staked its future on the development of inclisiran. Following the failure of its HDL-targeting drug, the Apo-A1 Milano/phospholipid complex MDCO-216, MDCO divested its hemostasis/coagulation products and antibiotics businesses to fund inclisiran’s development—a bold gamble at a time when RNA interference (RNAi) was still an exploratory technology. Notably, inclisiran was discovered by Alnylam, a pioneer in RNA therapeutics; yet even Alnylam lacked the confidence to develop this product itself. This marks Novartis’ second foray into RNAi. Although Novartis was an early partner of Alnylam, it announced its withdrawal from RNA therapeutic research in 2014, citing challenges in delivery systems and a scarcity of suitable targets. Novartis was not alone; other major pharmaceutical companies that had entered the RNAi field early on, including Merck, Roche, and GlaxoSmithKline, also retreated during the subsequent downturn in the field’s momentum.

Some have questioned whether big pharmaceutical companies’ risk aversion has made it necessary for important new drugs to rely on small biotechnology firms. In reality, although both large and small pharmaceutical companies make their living by selling drugs, their modes of survival differ. Small companies aim for a breakthrough success in one leap, whereas large pharmaceutical companies need to maintain stable sales. It is very difficult for The Medicines Company (MDCO) to develop Inclisiran into a blockbuster drug; even if it succeeds, MDCO would likely become another risk-averse large pharmaceutical company. For Novartis, acquiring a blockbuster product for just over ten billion dollars is not a significant burden. This model is more appealing to investors than bearing the long-term risks of fluctuating revenues—feast one year, famine the next. It is not that Novartis’ scientists lack the capability or courage to develop Inclisiran, nor that MDCO’s marketing and sales department lacks the ability to scale up Inclisiran. Simply put, expertise comes at different stages, and each party has its own specialized strengths.