Vertex's $10 billion Crinetics buyout draws investor doubts over premium price

Vertex was the lone bidder in a planned $10 billion acquisition of Crinetics Pharmaceuticals, a California company that focuses on endocrine medicines.

Crinetics currently markets a therapy for a rare hormonal disorder and is testing an experimental drug for congenital adrenal hyperplasia in late-stage trials. Vertex estimates that the two products could together generate more than $5 billion in annual sales at peak.

The deal values Crinetics at $85 per share, a 102% premium to its pre-deal price, making it one of the biggest mark-ups in biotech buyouts this year. Vertex's shares fell after the announcement, and analysts questioned whether the price was justified.

Stifel and other analysts said the valuation assumes a very bullish outcome for Crinetics' pipeline, sparking debate about whether the company paid a full or even a rich price for the assets.