Edgewise sells muscular dystrophy unit to Servier for $2.65B

Servier's $2.65 billion acquisition of Edgewise Therapeutics' muscular dystrophy business frees the biotech to focus on its cardiovascular pipeline while handing the French pharma a late-stage neuromuscular asset.

Servier agreed to pay $1.55 billion upfront and up to $1.1 billion in regulatory and commercial milestones for sevasemten, Edgewise's oral fast skeletal myosin inhibitor for Becker and Duchenne muscular dystrophies, the companies said Monday. The deal marks Servier's second multi-billion-dollar rare disease acquisition this year, following its $2.5 billion purchase of Day One Biopharmaceuticals in March.

"This transaction is designed to place the program in the hands of an organization with the experience and infrastructure to support its continued development for people living with Becker and Duchenne muscular dystrophies," Kevin Koch, Edgewise's chief executive officer, said in a statement.

Sevasemten is being tested in the Phase 3 GRAND CANYON trial for Becker muscular dystrophy, which has enrolled 175 patients and is designed with more than 98% statistical power. Top-line data are expected in the fourth quarter. The drug is also in Phase 2 for Duchenne muscular dystrophy, a more severe form of the X-linked genetic disorder. If approved, sevasemten would become the first therapy specifically indicated for BMD, which affects about 12,000 patients across the US, EU and Japan. The drug has secured Orphan Drug designation from both the FDA and European Medicines Agency for both indications, along with Fast Track and Rare Pediatric Disease designations in the US.

For Edgewise, the divestiture provides non-dilutive capital to sharpen its focus on cardiovascular disease. The company will now center efforts on EDG-7500, a cardiac sarcomere modulator in Phase 2 for hypertrophic cardiomyopathy, with 12-week data from the CIRRUS-HCM study due in the current quarter. A Phase 3 trial is expected to start in the fourth quarter. Edgewise is also planning a Phase 2 study of EDG-15400 in heart failure with preserved ejection fraction. The company had roughly $500 million in cash at the end of the first quarter; the Servier proceeds are expected to fully fund EDG-7500 through potential approval.

Edgewise shares surged more than 15% to $39.53 on Monday, hitting an all-time high. The stock has gained 62% year to date.

Analysts broadly welcomed the deal. Stifel called the transaction "surprising — and very favorable," noting that sevasemten had received little investor attention amid the focus on EDG-7500. Truist Securities described it as "a good deal" that provides non-dilutive capital and sharpens the pipeline, estimating that the BMD indication alone could achieve $1 billion in worldwide unadjusted peak sales. Stifel added that with the riskier sevasemten program removed, Edgewise has been "tidied up" for a potential acquirer interested in its cardiovascular assets.

Servier, which focuses on oncology, neurology and cardiometabolic diseases, gains a late-stage neuromuscular program and specialized research and development capabilities. The deal is expected to close in the third quarter, subject to regulatory clearances.

Edgewise's cardiovascular pipeline now represents its sole focus, with EDG-7500 as the lead candidate. The company trades at a valuation that reflects the uncertainty of mid-stage clinical data, but the Servier cash removes near-term financing risk. If EDG-7500 delivers positive Phase 2 results this quarter, the stock could re-rate further as the biotech approaches a pivotal readout in a large, underserved market.

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