Nothing makes a stock move quite like acquisition rumors. Nothing kills that rally quite like a swift denial. Just ask Revolution Medicines Inc. (RVMD), which experienced both extremes within hours on Wednesday.
The biotech company's shares rocketed higher after The Wall Street Journal reported that AbbVie Inc. (ABBV) was in advanced talks to buy the cancer-drug developer. Then reality hit: AbbVie told Reuters it wasn't in discussions with Revolution Medicines. At all. The stock gave back a chunk of those gains in after-hours trading, falling 11.5%.
From $16 Billion to Almost $20 Billion (and Back Again)
Before the acquisition report dropped, Revolution Medicines had a market cap of roughly $16 billion. Not exactly small potatoes, but the takeover speculation sent shares soaring nearly 29%, pushing its valuation close to $20 billion. That's a $4 billion increase in value based on... well, a report that turned out to be wrong, or at least premature.
According to the Journal, Revolution Medicines had attracted interest from multiple potential buyers, though no terms or purchase price were disclosed. The companies didn't immediately respond to requests for comment from news outlets, but AbbVie's denial to Reuters was pretty clear cut.
RVMD closed Wednesday's regular session up 28.6% at $102.71, before sliding in extended trading. The stock has more than doubled over the past year, riding a broader biotech sector rebound. Market data shows extremely strong momentum with bullish price trends across short, medium, and long-term timeframes.
Why AbbVie Made Sense (On Paper)
The speculation wasn't entirely out of left field. AbbVie, with a market value above $400 billion, has been actively hunting for growth opportunities, particularly in oncology. The pharmaceutical giant has increasingly focused on acquiring early-stage platforms and technologies, recently closing several multibillion-dollar oncology deals.
Revolution Medicines would fit that profile. Most of its experimental cancer drugs are still in development, and some haven't even entered human trials yet, according to the company's website. That's exactly the kind of early-stage pipeline AbbVie has been targeting to drive long-term growth.
Interestingly, AbbVie shares also climbed on the initial report, rising 4.2% to close at $233.42. Investors apparently liked the idea of the company bolstering its oncology portfolio. But those shares also retreated nearly 1% in after-hours trading following the denial.
AbbVie's Separate Bad News
As if denying a major acquisition wasn't enough news for one day, AbbVie also lowered its 2025 profit outlook. The company flagged a $1.3 billion in-process R&D charge hitting in the fourth quarter, which will weigh on earnings.
Despite the hiccup, AbbVie stock has gained over 30% in the past year. Market indicators show strong momentum and solid quality scores, though value metrics look weak. The stock faces short-term pressure while maintaining positive medium and long-term price trends.
The whole episode is a reminder of how quickly fortunes can shift in biotech land. One minute you're fielding acquisition interest worth billions, the next you're watching your stock slide as the supposed suitor says "thanks, but no thanks." Or at least "not right now."