Why Is Avidity Biosciences Inc. (RNA) Stock Surging in Premarket Today?

Avidity Biosciences, Inc. (NASDAQ:RNA) shares rocketed in premarket trading on Monday, October 27, 2025, following a transformative acquisition announcement. The biotechnology company agreed to merge with pharmaceutical giant Novartis AG (NYSE:NVS) in a deal valued at $12 billion on a fully diluted basis.

The transaction offers Avidity shareholders a substantial premium and provides Novartis with three late-stage clinical programs targeting rare genetic neuromuscular diseases, along with Avidity’s proprietary RNA-targeting delivery platform. The deal is expected to close in the first half of 2026, subject to regulatory approvals and shareholder consent.

Avidity Secures $12 Billion Buyout From Novartis, Unlocking Shareholder Value

Under the terms of the agreement, Avidity shareholders will receive $72.00 per share in cash at closing, representing approximately a 46% premium over the company’s October 24, 2025 closing price of $49.15 and about a 62% premium over the 30-day volume-weighted average price of $44.42. The deal, unanimously approved by both companies’ boards, will see Novartis acquire Avidity’s neuroscience pipeline and its unique RNA-targeting delivery platform.

Specifically, Novartis gains three late-stage clinical programs: delpacibart zotadirsen (del-zota) for Duchenne muscular dystrophy (DMD), delpacibart etedesiran (del-desiran) for myotonic dystrophy type 1 (DM1), and delpacibart braxlosiran (del-brax) for facioscapulohumeral muscular dystrophy (FSHD).

Before the merger closes, Avidity will spin off its early-stage precision cardiology programs into a new publicly traded company called SpinCo, which will focus on programs including AOC 1086 and AOC 1072 for rare genetic cardiomyopathies. Avidity shareholders will receive one SpinCo share for every ten Avidity shares held, plus potential pro rata cash distributions if certain assets are sold.

SpinCo will launch with $270 million in capital and trade publicly under CEO Kathleen Gallagher. The acquisition is projected to increase Novartis’ 2024-2029 sales CAGR from 5% to 6% and is expected to create multi-billion-dollar opportunities with product launches before 2030.

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RNA Stock Hits Record Levels Amid Broad Biotech Momentum

RNA shares were trading at $70.68 in premarket activity at 8:01 AM EDT on Monday, representing a massive gain of 43.64% or $21.45 per share above the previous closing price of $49.15. The stock had closed Friday at $49.15, up $0.60 or 1.24% in regular trading.

Prior to the acquisition announcement, Avidity had already delivered strong year-to-date returns of 69.02%, significantly outperforming the S&P 500’s 15.47% gain over the same period. The company’s market capitalization stood at approximately $7.17 billion based on Friday’s closing price, though the acquisition values the company at $12 billion on a fully diluted basis.

Industry analysts responded positively to the transaction, with several noting the strategic value for both companies. RBC Capital Markets analyst Luca Issi called the deal “another bullish signal for biotech,” while Bloomberg Intelligence analyst Andrew Galler highlighted that it provides Novartis with “three near-term launches across DMD, DM1 and FSHD.”

The market reaction extended beyond Avidity, with peer company Dyne Therapeutics (DYN) jumping as much as 20% in premarket trading as investors recognized increased pharmaceutical industry interest in novel RNA modalities for rare muscle diseases. Analyst firm Bernstein downgraded Avidity to Market Perform on October 27, 2025, while raising its price target from $52 to $72, essentially matching the acquisition price.

Disclaimer: The author does not hold or have a position in any securities discussed in the article. All stock prices were quoted at the time of writing.