Novartis is planning to buy U.S.-based biotech Excellergy for up to $2 billion, betting on a next-generation allergy treatment that may prove to work faster and better than anything currently on the market, the Swiss pharmaceutical giant said Friday.

The acquisition will add Exl-111, an early-stage drug candidate, to Novartis’ existing allergy portfolio. It is the latest bolt-on deal in the company’s attempt to offset looming patent expirations.

It comes just a week after Novartis announced it is acquiring Synnovation subsidiary Pikavation Therapeutics for up to $3 billion to secure the rights to an experimental breast cancer drug. 

In February, the company completed the acquisition of Avidity Biosciences, adding three late-stage programs to its neuromuscular pipeline, with potential for several launches before 2030. 

Excellergy’s lead asset remains several years away from hitting the market. Novartis said it will pay the smaller biotech in both upfront and milestone payments, and the transaction is expected to close in the first half of 2026, subject to regulatory approvals.

Novartis stock traded sideways in morning trading in Zurich. Palo Alto-based Excellergy is privately held.

Many of the best-selling drugs in the world are facing a loss of exclusivity in key jurisdictions in what the sector calls “the patent cliff.” By the turn of the decade, companies risk losing hundreds of billions in revenue as branded drugs are exposed to generic competition.

Like the second half of 2025, early 2026 has seen a slew of M&A announcements from Big Pharma, including Merck announcing it has reached an agreement to buy Terns Pharmaceuticals for up to $6.7 billion earlier this week. Britain’s GSK and AstraZeneca are also among the companies that have announced several deals over the past months.

GSK’s global head of business development Chris Sheldon told CNBC late last year he is looking for acquisitions often in mid-stage development in the $1 billion to $2 billion range, where the biology is validated biology but the outcome of a drug candidate isn’t yet obvious. Like Novartis and AstraZeneca, GSK looks for so-called bolt-on deals that complement its portfolio and technology.

Novartis warned earlier this year that profits would decline in early 2026 as some of its best-selling drugs, including heart medicine Entresto face generic competition. Its second-best-selling medicine Cosentyx is expected to lose key exclusivities around 2029.

“For the first half of the year, we will have a tough prior year base with Entresto, Promacta and Tasigna generics having entered the U.S. market mid-2025,” said then-incoming CFO Mukul Mehta in a post-earnings call with analysts in February.

Novartis is seeing strong growth in other medicines such as cancer drug Kisqali and multiple sclerosis treatment Kesimpta, but still has to bulk up its pipeline to offset declines. 

CEO Vas Narasimhan has said that the company is in the middle of the biggest patent expiration wave in the company’s history.

“It’s $4 billion that we will absorb over the course of this year across the three medicines,” Narasimhan told CNCB in February.