Small-cap biotech Apellis skyrockets 135% on news of acquisition by Biogen

The market capitalization of Apellis Pharmaceuticals, a small-cap maker of therapies for rare kidney diseases, more than doubled on Tuesday after it said it would be acquired at a substantial premium by pharmaceutical company Biogen.

Shares of Apellis rose more than 135% on the Nasdaq on Tuesday to $40.24 per share. This marks the highest level since August 2024.

Markets were reacting to news that the company is set to be acquired by Biogen, the developer of one of the world’s most expensive drugs, Spinraza, which is used to treat the genetic disease spinal muscular atrophy.

Biogen will pay $5.6 billion for Apellis, or $41 per share. This is 2.4 times the stock’s closing price on Friday, the day before the deal was announced. Shareholders of the small-cap company will also receive the right to two additional payments of $2 per share each if sales of its ophthalmology drug Syfovre reach $1.5-2.0 billion in any of the next five years. For comparison, the drug generated $587 million in 2025.

Biogen will acquire Apellis shares through a tender offer.

The boards of directors of both companies have already approved the transaction, according to the press release. The parties expect to close the deal in the second quarter, subject to regulatory approval.

The transaction will improve Biogen’s revenue growth outlook, according to the press release. The addition of two drugs – Syfovre, an ophthalmology treatment, and Empaveli, which is used to treat two rare kidney diseases – will lead to immediate revenue growth of $689 million, with potential growth of 15-20% at least through 2028.

RBC Capital Markets analyst Brian Abrahams said the deal could provide Biogen with much-needed near-term earnings growth. However, he added that Apellis’s Syfovre delivered disappointing early sales results and received mixed feedback from physicians.

Barron's reports that Syfovre sales fell 8% year over year in the fourth quarter due to the launch of a competing drug from pharmaceutical company Astellas. It cites this as one of the reasons for the decline in Apellis’s market capitalization in 2026.

Excluding Tuesday’s rally, Apellis shares have fallen 44% year to date.

At the same time, Wall Street remains sanguine: the stock has 15 “buy” ratings from analysts, up from 13 a month earlier. Another seven analysts recommend “hold,” while only one advises “sell.” However, after Tuesday’s surge, the consensus target price calculated by MarketWatch data is already 17% below current levels.

Following the deal announcement, Needham downgraded Apellis to “hold” from “buy,” while Morgan Stanley raised its target price on the stock by 64% to $41 per share, maintaining a neutral stance.