Lundbeck's Strategic Acquisition of Longboard Pharmaceuticals Marks Major Expansion in Rare Epilepsy Treatment

The Deal Framework

H. Lundbeck A/S has moved to acquire Longboard Pharmaceuticals, Inc., in a transformative transaction valued at approximately USD 2.6 billion in equity value. Under the agreement structure, Longboard shareholders will receive USD 60 per share in cash—representing a 77% premium to the 30-day volume-weighted average price as of September 30, 2024. The net transaction value, accounting for cash on hand, stands at USD 2.5 billion (approximately DKK 17 billion) on a fully diluted basis.

Both companies’ boards of directors have unanimously approved the transaction, which is anticipated to close in the fourth quarter of 2024, contingent upon the tender of at least a majority of Longboard’s outstanding voting shares and receipt of required regulatory approvals. Lundbeck plans to fund the acquisition through existing cash reserves and its established banking facility, with expectations to manage leverage within target parameters following closing.

Bexicaserin: The Cornerstone Asset

At the heart of this acquisition lies bexicaserin, Longboard’s lead therapeutic candidate, which represents a next-generation approach to treating seizure disorders. The compound operates as a 5-HT2C superagonist, a mechanism of action that distinguishes it within the current treatment landscape for neurological conditions. Clinical and preclinical evidence to date has demonstrated encouraging anti-seizure effects, positioning bexicaserin as a potential best-in-class therapy.

The compound is currently advancing through a global phase III clinical program designated the DEEp Program, which encompasses multiple trials including the pivotal DEEp SEA Study. This trial evaluates bexicaserin’s efficacy in treating seizures associated with Dravet syndrome in patients aged two years and older. The broader DEEp Program is planned across approximately 80 clinical sites globally and is designed to enroll around 480 participants spanning various developmental and epileptic encephalopathy (DEE) presentations, including Lennox-Gastaut syndrome and other rare epilepsy syndromes.

Notably, bexicaserin has already secured Breakthrough Therapy Designation from the U.S. FDA, recognition that underscores the unmet medical need it addresses and the potential clinical significance of its differentiated mechanism.

Clinical Evidence and Market Potential

Recent nine-month open-label clinical data has provided additional support for bexicaserin’s target product profile and the de-risked nature of its 5-HT2C mode-of-action. This data reinforces the compound’s potential to offer meaningful benefits in a patient population with few effective treatment options. Developmental and epileptic encephalopathies represent a significant area of unmet medical need, particularly for rare forms such as Dravet and Lennox-Gastaut syndromes, where current therapies often prove inadequate.

Lundbeck’s internal assessments project global peak sales potential for bexicaserin between USD 1.5 and 2 billion, contingent upon successful phase III outcomes and regulatory approval. The expected commercial launch is anticipated for the fourth quarter of 2028, positioning this asset as a meaningful contributor to future revenue diversification.

Strategic Rationale and Franchise Building

“This transformative transaction will become a cornerstone in Lundbeck’s neuro-rare franchise, with potential to drive growth into the next decade,” noted Charl van Zyl, President and CEO of Lundbeck. “Bexicaserin addresses a critical unmet need for patients suffering from rare and severe epilepsies, for which there are very few good treatment options available. With this acquisition, we continue to execute on our Focused Innovator strategy, transforming the lives of patients suffering from severe brain disorders.”

The acquisition directly aligns with Lundbeck’s strategic objective to build a specialized neuro-rare disease franchise and reinforces the company’s scientific and commercial leadership in rare epilepsies. By integrating Longboard’s clinical-stage pipeline, Lundbeck gains a late-stage asset that complements its mid- to late-stage development programs while addressing therapeutic gaps in a disease area where innovation remains limited.

Kevin R. Lind, President and Chief Executive Officer of Longboard, emphasized the collaborative spirit driving the transaction: “Longboard was founded to transform the lives of people living with devastating neurological conditions. I am incredibly proud of what our team has achieved, delivering groundbreaking data with a differentiated and inclusive clinical approach to address the needs of a wide range of DEEs. Lundbeck’s capabilities will accelerate our vision to provide increased equity and access for underserved DEE patients with significant unmet medical needs.”

Execution Timeline and Next Steps

The transaction’s anticipated closing in Q4 2024 is subject to customary closing conditions, including receipt of required regulatory clearances and approval from a majority of Longboard shareholders. Lundbeck’s financing structure—utilizing existing cash and established banking facilities—provides a clear funding pathway without reliance on external capital markets, reducing execution risk.

Following the transaction close, Lundbeck’s immediate focus will center on de-leveraging its balance sheet while integrating bexicaserin into its broader neuro-rare disease strategy, positioning the company to capture significant commercial opportunity in an underserved therapeutic market.