Abivax SA (ABVX) is having quite a Wednesday, with shares climbing on renewed chatter that Eli Lilly and Co (LLY) might be preparing to make an offer for the Paris-based biotech.
It's the kind of rumor that gets traders excited, and for good reason. "The share price movement is driven by speculation around a possible takeover," Stifel analyst Damien Choplain told Reuters. When a pharma giant like Lilly starts circling, small biotechs tend to get repriced quickly.
The timing makes sense when you look at what Abivax has been accomplishing. Over the past six months, the company's stock has rocketed more than 1,500%, according to Benzinga Pro data. That's not a typo—fifteen hundred percent.
Why All the Excitement?
The catalyst was July's announcement of overwhelmingly positive topline results from two Phase 3 trials, ABTECT-1 (Study 105) and ABTECT-2 (Study 106). These eight-week induction trials tested oral obefazimod (ABX464) in adult patients with moderately to severely active ulcerative colitis, a chronic inflammatory bowel condition that's notoriously difficult to treat.
The experimental treatment demonstrated impressive efficacy, representing a significant breakthrough that offers new hope for patients struggling with this debilitating ailment. It's the kind of data that transforms a speculative biotech into an acquisition target overnight.
Abivax kept the momentum going in October, presenting additional clinical data for obefazimod at the United European Gastroenterology Meeting. In the pooled ABTECT 1 & 2 trials, once-daily obefazimod 50mg achieved clinically meaningful improvements in clinical response across all patient subgroups, including those who hadn't responded adequately to prior advanced therapies. That last part matters—these are often the hardest patients to help.
Lilly's Shopping Spree
Eli Lilly certainly has the appetite and resources for deals. Back in August, the pharmaceutical giant issued a 40-year bond, sparking immediate speculation about a major acquisition in the works. Viking Therapeutics Inc. (VKTX) emerged as one potential target on analysts' radars.
More recently, in June, Lilly agreed to acquire Verve Group SE (VERV), a Boston-based clinical-stage company developing genetic medicines for cardiovascular disease. The deal structure shows how Lilly thinks about these transactions: $10.50 per share upfront for roughly $1 billion total, plus one non-tradeable contingent value right per share that could deliver up to an additional $3 per share. That brings the total potential consideration to $13.50 per share, or approximately $1.3 billion all in.
It's a pattern that suggests Lilly is actively building out its pipeline through strategic acquisitions, particularly in areas where breakthrough treatments are emerging. Abivax's ulcerative colitis drug certainly fits that profile.
As of Wednesday's trading, Abivax stock was up 4.28% at $128.30. Not bad for a company that's gone from relative obscurity to takeover target in less than a year.