Dova Pharmaceuticals Rallies Following Deal To Be Acquired By SOBI For Up To $915M

Shares of small-cap biotech Dova Pharmaceuticals Inc DOVA were advancing strongly Monday in reaction to a buyout deal.

Deal Terms

Dova said Monday it has entered into an agreement to be bought by Swedish Orphan Biovitrum, or SOBI, for $27.50 per share in cash, along with one non-tradeable contingent value right, or CVR, that entitles Dova shareholders to receive an additional $1.50 per share in cash upon regulatory approval of Doptelet.

The upfront cash consideration of $27.50 per share represents a 36% premium to Dova's Friday closing price.

Along with the CVR, the total consideration works out to $29 per share, or a total of $915 million on a fully diluted basis.

Doptelet is company's lead drug, has been approved by the FDA for chronic liver disease as well as chronic immune thrombocytopenia.

It is being evaluated for a third indication: chemotherapy-induced thrombocytopenia.

The M&A deal has been approved by boards of both companies.

The companies expect the transaction to close in the fourth quarter of 2019.

Deal Logic

SOBI sees the transaction as an opportunity to increase its leadership position in hematology and orphan diseases — and to expand its presence in the U.S.

The company also plans to leverage its strong international presence to maximize the availability and commercial potential of Doptelet globally.

"We are extremely pleased to announce this merger with Sobi, which we believe will continue the expansion of DOPTELET in the U.S., and provide the necessary resources to maximize DOPTELET's availability to patients in both the U.S. and internationally," Dova CEO David Zaccardelli said in a statement. 

About 125 professionals from Dova will join the team at SOBI, strengthening its hematology infrastructure and broadening the company's value chain in the U.S.

Dova shares were trading 38.68% higher to $28 in Monday's premarket session. 

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