Neurocrine Biosciences Agrees to Acquire Soleno Therapeutics for $2.9 Billion

Neurocrine Biosciences Inc. announced on Monday an agreement to acquire Soleno Therapeutics Inc. for approximately $2.9 billion in cash. The deal, which includes a base payment of $55 per share, represents a premium of about 70% over Soleno's closing stock price on the previous Friday.

The acquisition will allow Neurocrine to enter the market for therapies addressing rare genetic disorders, particularly Prader-Willi syndrome (PWS).

Soleno Therapeutics focuses on developing treatments for rare endocrine diseases. Its lead candidate, DCCR (diazoxide choline extended-release tablets), received U.S. Food and Drug Administration (FDA) approval in March 2024 for treating hyperphagia, a symptom of PWS characterized by excessive hunger.

PWS affects an estimated 1 in 15,000 to 30,000 people worldwide and leads to complications including obesity, intellectual disability, and behavioral issues.

Neurocrine Biosciences, based in San Diego, California, specializes in neurological and endocrine disorders. The company markets products such as INGREZZA for tardive dyskinesia and has a pipeline including treatments for congenital adrenal hyperplasia and other rare conditions.

This acquisition marks Neurocrine's largest deal to date and supports its strategy to diversify beyond its current offerings.

Soleno, headquartered in Redwood City, California, has advanced DCCR through late-stage clinical trials. The therapy addresses a critical unmet need in PWS, where no approved treatments for hyperphagia existed prior to the FDA's decision. Soleno reported positive results from its Phase 3 study in 2023, showing DCCR reduced hyperphagic behaviors in patients.

The transaction is expected to close in the second half of 2024, subject to customary closing conditions including regulatory approvals from the U.S. antitrust authorities and shareholder approval from Soleno. Neurocrine has secured debt financing commitments to fund the purchase. Upon completion, Soleno will become a wholly owned subsidiary of Neurocrine.

The deal comes amid growing interest in rare disease markets, where smaller patient populations often yield high pricing for approved therapies. Neurocrine projects that DCCR could generate peak annual sales exceeding $1 billion. Analysts note that integrating Soleno's expertise could accelerate Neurocrine's expansion into endocrinology.

Stakeholders include PWS patients and families, who may gain improved access to DCCR, as well as investors in both companies. Neurocrine's shareholders could see diluted earnings in the short term due to acquisition costs, while Soleno's investors benefit from the premium. Post-acquisition, Neurocrine plans to commercialize DCCR in the U.S. and pursue international approvals.