RTW Biotech Boosted as Novartis Acquires Avidity Biosciences for $12 Billion

RTW Biotech Opportunities Ltd (LON: RTW) is set to benefit from Novartis's acquisition of Avidity Biosciences, Inc. (Nasdaq: RNA), one of its portfolio companies.

The deal underscores the strategic value of RNA therapeutics and provides a substantial return for RTW Bio.

Novartis will acquire Avidity for $72 per share in cash, valuing the company at approximately $12 billion on a fully diluted basis. This represents a premium of approximately 46% over Avidity's closing share price on October 24th, which was $49.15. The acquisition price also reflects a premium of roughly 62% over Avidity's 30-day volume-weighted average price of $44.42.

As of September 30, 2025, Avidity was RTW Bio's third-largest holding, representing 7.0% of its net asset value (NAV). The acquisition will therefore have a positive impact on RTW Bio's overall portfolio performance.

Prior to the merger's completion, Avidity will spin off its early-stage precision cardiology programs and collaborations into a new entity called SpinCo. Avidity shareholders will receive one share of SpinCo for every ten shares of Avidity they hold.

Alternatively, they may receive a pro rata cash distribution if SpinCo assets or SpinCo itself are sold to a third party before the merger closes. SpinCo is expected to become a publicly traded company following the spin-off.

Avidity Biosciences is a clinical-stage biotechnology company focused on developing RNA therapeutics, with a particular emphasis on rare muscle diseases. Its lead candidate, del-desiran, is currently in a Phase 3 trial for myotonic dystrophy type 1 (DM1).

Avidity's technology has achieved targeted RNA delivery into muscle tissue, and the company is expanding its pipeline into cardiology and immunology.

Rod Wong, CIO of RTW Investments, highlighted the successful outcome of the investment. “Avidity's acquisition by Novartis represents a successful conclusion to a relationship begun when RTW led Avidity's crossover financing round in 2019, ahead of its 2020 IPO.”

He further noted that this transaction marks the fifth take-out from RTW Bio's portfolio announced since June 30, following deals for Verona, Alcyone, Merus, and Akero.

For RTW Bio, this acquisition not only provides a significant financial return but also reinforces its reputation as a savvy investor in the biotech space.