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Sanofi to Buy Biotech Kadmon for $9.50-Share, $1.9 Billion

The purchase of Kadmon is designed to boost Sanofi’s transplant business. Sanofi shares dipped and Kadmon's jumped.
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Sanofi  (SNY) - Get Sanofi Sponsored ADR Report shares fell, while Kadmon  (KDMN) - Get Kadmon Holdings, Inc. Report shares leaped after the French pharmaceutical titan agreed to buy the New York biotech company for $1.9 billion.

The deal will boost Sanofi’s transplant business, it said.

Kadmon holders will receive $9.50 a share cash, producing that total equity value of $1.9 billion. 

The boards of Sanofi and Kadmon approved the terms.

Sanofi recently traded at $50.04, down 3%, and Kadmon at $9.15, up 73%.

“The acquisition supports Sanofi’s strategy to continue to grow its general medicines core assets and will immediately add Rezurock (belumosudil) to its transplant portfolio,” the company said.

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“Rezurock is a recently [Food and Drug Administration]-approved, first-in-class treatment for chronic graft-versus-host disease for adult and pediatric patients 12 years and older who have failed at least two prior lines of systemic therapy.”

That disease is characterized by inflammation in various organs and is associated with bone-marrow and stem-cell transplants.

“We are transforming and simplifying our general medicines business and have shifted our focus on differentiated core assets in key markets,” said Olivier Charmeil, executive vice president of general medicines for Sanofi.

Sanofi expects to complete the acquisition in the fourth quarter, subject to conditions including antitrust clearance and a vote of Kadmon holders.

The transaction is expected to modestly dilute Sanofi’s earnings per share in 2022.

The pipeline at Kadmon includes drug candidates for immune and fibrotic diseases as well as immuno-oncology therapies.