Astellas Pharma to Acquire Iveric Bio for $5.9 Billion for Innovative Vision Loss Treatment

Astellas Pharma has announced the acquisition of Iveric Bio for $5.9 billion, banking on the potential of its innovative treatment for vision loss, which could help Astellas establish a separate eye care drug business.

 The deal is expected to close with Astellas paying $40 per share for Iveric, a 22% premium to the company’s closing price. The Board of Directors of both companies have unanimously approved the purchase, and pending approval from shareholders and regulatory authorities, the takeover could be completed in the third quarter of this year.

As part of the agreement, Astellas will gain access to Zimura, Iveric’s treatment being tested as a therapy for geographic atrophy, a form of vision loss. Zimura has completed two Phase 3 studies and is currently being evaluated by US authorities. A decision is expected in the third week of August. Astellas is seeking to mitigate the potential patent losses of its top-selling products, and it has potential competition on the horizon, as its prostate cancer treatment Xtandi will lose patent protection in 2027.

Zimura is expected to generate $555 million and $871 million in yearly revenue in 2026 and 2027, respectively, according to Jefferies analyst Stephen Barker, and eventually $2.4 billion by 2034. However, Zimura faces competition, as there are many comparable medications being developed for geographic atrophy. Syfovre, an Apellis Pharmaceuticals therapy, was the first drug to be marketed for the condition, and it also inhibits complement system activation, which is part of the body’s innate immune response. 

Both medications aim to slow the rate of recovery of geographic atrophy, which can lead to patchy lesions in the eye that may grow larger over time. The drugs delayed the progression of such lesions in tests but had no immediate effect on eyesight.

Despite the potential of Zimura, it is associated with a potential risk of new blood vessel creation, which may require additional therapy. Nonetheless, Syfovre and Zimura are considered potential successes in the market. The approval of Syfovre resulted in a 50% increase in Apellis shares, which has agitated possible bidders. Apellis will release its quarterly earnings report in a few days, and in pre-market trade, shares dropped by 8%.

The acquisition is a significant opportunity for Iveric, which was previously known as Ophthotech. The company has previously faced multiple Phase 3 failures, leading to layoffs and a strategic reset. Following the rebranding, Zimura remains the company’s most valuable asset. According to Astellas, Zimura will provide a range of ophthalmology-focused capabilities, which includes a commercial team and access to a network of specialists and medical institutions.

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