AbbVie Spends $1.4 Billion to Acquire Aliada, Betting on Uncertain Alzheimer’s Treatment Prospects, Stock Price Only Slightly Rises by 1%

AbbVie announced on Monday that it would buy Aliada Therapeutics for $1.4 billion in cash, a bet on an experimental Alzheimer's treatment that is in early development. The acquisition pitted AbbVie, which has a market capitalization of as much as $330 billion, against at least three other pharmaceutical companies interested in Aliada, according to insiders. Shares of AbbVie were up 1% at Monday's close.

Competition for Aliada's privately held Alzheimer's drug candidate has driven up the deal price, according to people familiar with the matter, showing that despite the historical regulatory risks associated with drugs for the mentally wasting disease, there are still many pharmaceutical companies willing to invest early in such treatments. Two similar therapies that reduce toxic amyloid plaques in the brain were recently approved in the U.S. after decades of failure.

AbbVie is aggressively expanding its portfolio of neuroscience products as sales of its top-selling arthritis drug Humira fell 33%. Humira was once the world's best-selling drug, but now faces competition from several cheaper biosimilars. To further strengthen its pipeline, AbbVie has already acquired neuroscience drug developer Cerevel Therapeutics and cancer drug developer ImmunoGen earlier this year in deals totaling about $19 billion.

At least 11 monkeys have died at Hong Kong Zoo in the past week. Abbvie said Aliada's antibody therapy, ALIA-1758, could be the best of its kind. ALIA-1758 uses a protein in the blood called transferrin to carry iron to transport an antibody that degrades and eliminates amyloid plaques - sticky protein deposits in the brain that are a sign of Alzheimer's disease.

"Many promising CNS targeted therapies fail to enter late-stage trials because they cannot cross the blood-brain barrier," said Michael Ryan, Aliada's medical director. "Our [drug delivery] platform directly addresses this challenge, effectively delivering targeted drugs and potentially transforming the way we treat neurological diseases," he added.

With the approval of Biogen (BIIB.O) and Eisai (4523.T) (Leqembi) and Lilly (Lill.N) (Kisunla), amyloid plaques are confirmed as a therapeutic target, BMO analyst Evan Seigerman said. But Alzheimer's disease remains a high-risk indication. The number of people with Alzheimer's disease is expected to double from 6.9 million in 2020 to nearly 14 million by 2060, according to the CDC. Abbvie expects to close the deal by the end of this year.

Abbvie's neuroscience therapies, which include botox and bipolar disorder drug Vraylar, brought in $4.13 billion in sales in the first half of 2024, up 15.3% year over year.