CVRs are a mechanism for bridging valuation gaps between buyers and sellers in public M&A transactions when there is not an agreement on price. CVRs are especially attractive in life sciences transactions because target companies already face high beta outcomes that depend on uncertain future events like clinical trial results, regulatory approvals, and successful product commercialization. Recent public deals that involved the use of CVRs include AstraZeneca’s acquisition of CinCor Pharma last February, French biopharmaceutical company Ipsen’s acquisition of Albireo Pharma in March and Novartis’s acquisition of Chinook Therapeutics announced June 2023. Here are seven things life sciences buyers and sellers should know about CVRs.
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Source: https://www.lexology.com/library/detail.aspx?g=0f946025-04a8-49f9-8846-be1989f98050