NVS Inks a Licensing Deal With Arrowhead for siRNA Therapy

Novartis (NVS) has entered into a licensing and collaboration agreement with Arrowhead Pharmaceuticals, Inc. (ARWR) for the latter’s ARO-SNCA.

ARO-SNCA is Arrowhead’s preclinical stage siRNA therapy against alpha-synuclein for the treatment of synucleinopathies, such as Parkinson’s Disease, and other additional collaboration targets.

With this licensing deal, bigwig Novartis aims to develop a treatment for the complex Parkinson’s Disease, which affects millions of patients worldwide.

Shares of Novartis have gained 33.2% year to date compared with the industry’s gain of 1.8%.

More on NVS’ Deal With ARWR

Novartis will receive an exclusive worldwide license to research, develop, manufacture, and commercialize ARO-SNCA, which utilizes Arrowhead’s Targeted RNAi Molecule (TRiM) platform. Novartis also has the option to select additional collaboration targets outside Arrowhead’s current pipeline for development using the TRiM platform.

Arrowhead is responsible for conducting and completing preclinical research activities necessary to enable a clinical trial application filing for all licensed programs under the agreement. Thereafter, Novartis will assume sole control over development, manufacturing, medical affairs, and commercialization activities.

Per the terms of the deal, Novartis will make an upfront payment of $200 million to Arrowhead and the latter is also eligible to receive is eligible to receive up to $2 billion in potential milestone payments plus royalties on commercial sales.

The transaction is expected to be closed in the second half of 2025.

Shares of ARWR gained 16.57% on Sept. 2 as investors are upbeat about the cash influx.

NVS Looks to Broaden Portfolio

Novartis’ performance has been strong in the past few quarters, driven by the solid performance of its key brands.

Approval of new drugs and label expansion of existing drugs should enable the company to offset the adverse impacts of generic competition for Tasigna and Promacta.

While organic growth continues to drive business, NVS is focused on strategic acquisitions and deals to strengthen its pipeline.

Developing a treatment for neurodegenerative diseases like Parkinson’s Disease is a challenging affair, and many pharma giants are trying their hands at it.

NVS had earlier faced a setback in this space. We remind investors that Novartis was developing minzasolmin (oral small molecule, alpha-synuclein misfolding inhibitor) with Belgium-based UCB for Parkinson’s Disease. However, the candidate did not meet its primary and secondary clinical endpoints in the ORCHESTRA proof-of-concept study, and the program was terminated.

In June 2025, another Swiss pharma giant, Roche (RHHBY), announced its decision to proceed with phase III development of prasinezumab, an investigational anti-alpha-synuclein antibody, in early-stage Parkinson’s disease.

The decision was based on data from the phase IIb PADOVA study and ongoing open-label extensions (OLEs) of PADOVA and phase II PASADENA studies.

Data from the PADOVA and OLE studies suggest a potential clinical benefit of prasinezumab when added to effective symptomatic treatment in early-stage Parkinson’s disease. While prasinezumab showed potential clinical efficacy in the primary endpoint of time to confirmed motor progression, it did not reach statistical significance.

In December 2013, Roche entered into a licensing agreement with Prothena to develop and commercialize monoclonal antibodies targeting aggregated alpha-synuclein, such as prasinezumab, for the treatment of Parkinson’s Disease.

NVS’ Zacks Rank

Novartis currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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