U.S. Biotech Firm Allakos Weighs Potential Sale

(Bloomberg) -- Allakos Inc., a developer of clinical-stage drugs, is exploring strategic options including a potential sale, according to people familiar with the matter. Its shares rose as high as 46% on the news..The Redwood City, California-based company is working with a financial adviser on the review, said the people, who asked to not be identified because the matter isn’t public. It is sounding out interest from potential buyers including global pharmaceutical and biotechnology companies, the people said..No final decision has been made and the company could decide against a sale, they said. A representative for Allakos declined to comment..Allakos’ shares were up 36% to $132.35 at 3:09 p.m. in New York trading, giving the company a market value of about $6.4 billion..Before Wednesday’s spike, the shares had been up more than 61% in the past year on optimism about products in its pipeline, including a drug for treating eosinophilic gastritis, a rare disease that causes injury and inflammation in the stomach..The market for that drug could be at least $2.5 billion, William Blair & Co. analysts led by Tim Lugo wrote in a note to clients in October..Allakos said in August that a study of its medicine for a pair of rare diseases showed significant improvements for patients..To contact the reporters on this story: Nabila Ahmed in New York at nahmed54@bloomberg.net;Manuel Baigorri in Hong Kong at mbaigorri@bloomberg.net;Ed Hammond in New York at ehammond12@bloomberg.net.To contact the editors responsible for this story: Liana Baker at lbaker75@bloomberg.net, Matthew Monks.©2019 Bloomberg L.P.

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U.S. Biotech Firm Allakos Weighs Potential Sale

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