Nightstar shares were up 66% to $25.16 in trading Monday. Biogen's offer for Nighstar is $25.50 a share.
Nightstar makes gene therapy treatments for choroideremia, a rare, inherated eye disease that leads to blindness.
"Our agreement with Biogen will give us the platform and resources to expand our mission to maintain and restore sight in patients with inherited retinal diseases," said Nightstar CEO David Fellows. "This transaction accelerates treatment to patients through Nightstar's key retinal gene therapy programs that modify or halt progression of blindness."
The gene therapy segment has been ripe for consolidation activity in recent years as the once controversial treatment has found its footing.
Last week, Roche Holding agreed to pay $4.8 billion to acquire Spark Therapeutics and last year Novartis purchased AveXis for $8.7 billion.
"Over the last six years since foundation in 2013, Nightstar has established itself as one of the global leaders in retinal gene therapies. I am proud of Nightstar's achievements, delivering two proof-of-concept programs and building a world class organisation," Nightstar Chairman Chris Hollowood said.