Tokyo: Novartis AG agreed to acquire AveXis Inc. for $8.7 billion to expand its position in gene therapy with a treatment for a rare disease that afflicts infants.

Shareholders of the Bannockburn, Illinois-based company will receive $218 a share in cash in a tender offer, Novartis said in a statement Monday. The price is 88% above where AveXis closed Friday.

AveXis is developing a product, AVXS-101, to treat spinal muscular atrophy, an inherited neurodegenerative disease caused by a defect in a single gene. The company also has valuable manufacturing and research capabilities that would give its Swiss buyer a platform alongside its CAR-T research in cancer “to advance a growing pipeline of gene therapies across therapeutic areas," said Novartis chief executive officer Vas Narasimhan.

The acquisition, the first announced by Novartis since Narasimhan became CEO in February, will accelerate the company’s effort to focus on prescription medicines. It was unanimously approved by the boards of both companies. Novartis agreed last month to sell its stake in a consumer-health joint venture to partner GlaxoSmithKline Plc for $13 billion, giving the Basel, Switzerland-based company more firepower for its pharmaceutical operations and acquisitions.

AVXS-101, a one-time treatment, helped a small group of babies with spinal muscular atrophy hit development milestones at a rate previously unseen, a study showed in November. The first medication for the disease, Biogen Inc.’s Spinraza, won approval less than a year ago. Babies with the most severe form of the disease typically die before age two.

AveXis expects to file in the second half of this year for approval from US regulators, with marketing of AVXS-101 expected in 2019, according to Novartis’s statement.

AveXis, incorporated in 2010, sold shares in an initial public offering in 2016 at $20 a share. Chief executive officer Sean Nolan is a former executive at InterMune Inc. and Ovation Pharmaceuticals Inc.

The first gene therapy approved in Western Europe, UniQure NV’s Glybera, turned out to be a flop. The company withdrew it from the market last year and is shifting its focus to hemophilia treatments. Bloomberg