Roche, a leading global pharmaceutical company, has announced that it has reached an agreement to acquire 89bio, Inc., a biopharmaceutical firm listed on Nasdaq under the ticker ETNB. 89bio is known for its focus on developing treatments for liver diseases and other cardiometabolic conditions. One of its key products, pegozafermin, is a specialized drug designed to replicate a natural protein known as fibroblast growth factor 21 (FGF21). This drug is currently in the final stages of development and aims to provide treatment options for patients suffering from Metabolic Associated Steatotic Liver Disease (MASH), specifically targeting those with moderate to severe liver fibrosis, as well as patients with cirrhosis.
The acquisition deal is expected to conclude in the fourth quarter of 2025, highlighting Roche’s dedication to advancing innovative healthcare solutions in the fields of cardiovascular, renal, and metabolic diseases. There is a significant focus on addressing the health challenges associated with overweight and obesity, conditions that contribute to MASH. Pegozafermin is notable for its unique method of action, which not only shows promise in terms of effectiveness and tolerability but also creates opportunities for future synergies with other drugs in Roche’s portfolio. By bringing 89bio into its fold, Roche aims to enhance its pipeline of therapies that tackle various metabolic diseases.
Pegozafermin stands out as a glycoPEGylated form of FGF21, specifically engineered to meet the needs of patients with MASH. Its anti-fibrotic and anti-inflammatory properties, combined with its strong safety profile, position it as a potential leader in treating moderate to severe liver diseases and cirrhosis. Roche’s plan includes integrating the talented employees from 89bio into its Pharmaceuticals Division, further strengthening its team and resources.
According to the terms set forth in the merger agreement, Roche will initiate a tender offer aimed at acquiring all available shares of 89bio’s common stock. The proposed acquisition price is $14.50 per share in cash at the time the deal closes. Additionally, there is a component known as a non-tradeable contingent value right (CVR), which may result in further cash payments based on specific performance milestones related to pegozafermin. The total equity value of the deal could reach approximately $2.4 billion at closing, while the complete deal value may rise to as much as $3.5 billion. This acquisition offer represents a significant premium—around 52%—over 89bio’s share price averaged over the previous 60 days.
As part of the process, 89bio will officially recommend to its stockholders that they tender their shares in response to Roche’s offer. After the initial tender offer is completed, Roche plans to purchase any remaining shares at the same price of $14.50 per share, along with the contingent cash rights, through a follow-up merger.
The contingent value rights will enable shareholders to receive additional payments contingent upon achieving specific sales milestones. For instance, a payment of $2 per share is expected to be made once Pegozafermin records its first commercial sale to patients with cirrhosis, specifically those in the F4 stage with MASH. Additional payments are structured around annual global sales of the drug, set at thresholds of $3 billion and $4 billion, with respective payment amounts of $1.50 and $2.50 per share.
Advisors: Citi is acting as exclusive financial advisor to Roche and Sidley Austin is acting as legal counsel to Roche. Moelis & Company LLC and Centerview Partners LLC are serving as financial advisors to 89bio and Gibson, Dunn & Crutcher is serving as legal counsel.
KEY QUOTES:
“This acquisition further strengthens our portfolio in cardiovascular, renal, and metabolic diseases and offers opportunities to explore combinations with existing programs in our pipeline. We are highly encouraged by pegozafermin’s potential to become a transformative treatment option in MASH, one of the most prevalent comorbidities of obesity, and to meet diverse patient needs associated with this complex disease. With its combined anti-fibrotic and anti-inflammatory mechanism, pegozafermin could potentially offer best-in-disease efficacy for all moderate to severe MASH patients.”
Thomas Schinecker, Roche Group CEO
