Roivant Sciences Boosts Stake in Immunovant and Repurchases Own Stock

Roivant Sciences Ltd. (Nasdaq: ROIV) has made a strategic move to increase its ownership in Immunovant, Inc. (Nasdaq: IMVT) and repurchase its own shares, demonstrating confidence in its future prospects and commitment to shareholder value. The biopharmaceutical company announced a $200 million investment in Immunovant, increasing its stake to approximately 63.8%, and a $1.5 billion share repurchase program, including the buyback of all shares held by Sumitomo Pharma for $648 million.

Immunovant, a clinical-stage biopharmaceutical company focused on enabling normal lives for people with autoimmune diseases, will use the proceeds from Roivant's investment to advance the development of its lead asset, IMVT-1401, in multiple indications. The therapy is being developed for myasthenia gravis, thyroid eye disease, and warm autoimmune hemolytic anemia. With the additional funding, Immunovant plans to initiate a pivotal trial for myasthenia gravis in the early part of calendar year 2022, resume trials in WAIHA and TED, and initiate at least two additional clinical studies, including another pivotal trial in 2022.

Roivant's board of directors has approved a share repurchase program for up to $1.5 billion of the company's common shares, including an agreed repurchase of the entire Sumitomo Pharma stake for $648 million. This transaction will reduce Roivant's total number of outstanding shares by approximately 9% (as of February 9, 2024), increasing the ownership percentage of remaining shareholders and potentially enhancing their value per share. The share repurchase program can also increase earnings per share (EPS) for remaining shareholders by spreading net income over fewer shares, leading to a higher EPS. Additionally, the reduced supply of shares in the market could potentially increase the stock price due to increased demand.

Roivant's investment in Immunovant and its share repurchase program reflect the company's commitment to driving innovation and shareholder value. By investing in Immunovant's promising pipeline and repurchasing its own shares, Roivant is positioning itself for future growth and success in the biopharmaceutical market.