Protagonist Therapeutics (NASDAQ:PTGX), a biotech focused on peptide-based therapeutics, traded ~30% higher on Friday after The Wall Street Journal reported that Johnson & Johnson (NYSE:JNJ) is in talks to acquire the company.
Citing people familiar with the matter, the publication noted that the deal, details of which were not yet finalized, is expected to consolidate JNJ’s (NYSE:JNJ) existing partnership with the Newark, California-based company.
A final agreement is not guaranteed, the people said, adding that the terms of the deal being discussed couldn’t be obtained.
A potential transaction is expected to well surpass Protagonist’s (NASDAQ:PTGX) market capitalization of roughly $4B, including a deal premium, and boost JNJ’s portfolio of immune and cancer drugs with two experimental drugs.
The companies are currently in pact to develop an oral therapy for immune diseases, including plaque psoriasis and ulcerative colitis, with JNJ having an exclusive license to commercialize the product.
With the deal, the New Jersey-based pharma giant, which already owns 4% of its partner, is expected to add another experimental therapy called rusfertide, developed by Protagonist (NASDAQ:PTGX) and Takeda (TAK).
Rusfertide has shown potential in a rare blood cancer called polycythemia vera in late-stage development.