Longboard Set to be Acquired by Lundbeck for $2.6B, Stock Soars 52%

Core Viewpoint - Longboard Pharmaceuticals (LBPH) is being acquired by Lundbeck A/S for $60 per share, totaling a deal value of $2.6 billion in equity and $2.5 billion net of cash, with shares of LBPH rising 51.7% following the announcement [1][2]. Company Overview - Longboard is a clinical-stage biopharmaceutical company focused on developing treatments for neurological disorders, with its lead candidate, bexicaserin, currently in phase III development aimed at reducing seizures [3]. Acquisition Details - The cash offer represents a 77% premium over Longboard's 30-day volume-weighted average stock price as of September 30, 2024, and has been unanimously approved by both companies' boards, expected to close in Q4 2024 pending regulatory conditions [2]. - Lundbeck plans to finance the acquisition through existing cash resources and bank financing [2]. Strategic Implications - The acquisition is a strategic move for Lundbeck to enhance its neuroscience pipeline, particularly in neuro-rare diseases, gaining access to bexicaserin for treating seizures in rare epilepsies like Dravet syndrome and Lennox-Gastaut syndrome [4]. - Year-to-date, LBPH shares have increased by 878.3%, contrasting with a 2% decline in the industry, largely due to positive developments in the bexicaserin program [4]. Clinical Development - Longboard's bexicaserin has received Breakthrough Therapy, Orphan Drug, and Rare Pediatric Disease designations from the FDA, with a projected commercial launch in Q4 2028 and estimated peak sales potential of $1.5 billion to $2 billion [7]. - The ongoing phase III DEEp SEA study is evaluating bexicaserin for seizures associated with Dravet syndrome in patients aged two years and older, part of a broader DEEp Program involving around 480 patients [6]. Additional Assets - The acquisition will also include Longboard's investigational candidate LP659, which is in early-stage development for rare neuroinflammatory conditions [8]. Competitive Landscape - Other companies in the epilepsy market include Xenon Pharmaceuticals, which is developing azetukalner for focal onset seizures and has ongoing phase III studies [9][10].