A heavily shorted rare-disease biotech got its long-awaited lifeline Wednesday. KalVista Pharmaceuticals (KALV) surged 38.6% to $26.67 after Italy’s Chiesi Group agreed to buy the company for $27 a share in cash — a price that left short sellers with nowhere to hide.
The deal values KalVista at roughly $1.9 billion, a 36% premium to its 30-day volume-weighted average price. With the stock now trading just 1.2% below the offer, investors are signalling near‑certainty that the transaction will clear its remaining hurdles. Closing is expected in the third quarter of 2026.
Trading volume told its own story: 69.4 million shares changed hands, more than 33 times the three‑month average of 2 million.
KalVista had long been one of the most hated names on Wall Street. Short interest stood at 40% of float — a huge bet against a stock that, since its 2015 IPO, had cratered 66%. That crowded short position turned into rocket fuel when Chiesi’s cash offer landed, triggering a violent squeeze that forced bears to cover in size.
Chiesi’s prize is EKTERLY (sebetralstat), the first oral, on‑demand treatment for hereditary angioedema (HAE) — a rare genetic disorder that affects roughly one in 50,000 people and causes recurrent, painful swelling. Unlike existing injectable options, EKTERLY can be taken by mouth.
The drug only won US approval in July 2025, and KalVista has reported just three quarters of sales so far. Projected 2025 revenue stands at $49 million. Chiesi believes its global infrastructure can accelerate the drug’s reach to many more patients.
“This acquisition supports our strategy to accelerate impact in rare diseases,” said Jean-Marc Bellemin, Chiesi Group’s CFO and incoming interim CEO. KalVista’s management called the deal a clear win for shareholders and a long‑term commitment to patients.
For investors, the remaining spread offers a tiny arbitrage opportunity — assuming no regulatory or shareholder surprises. For the short sellers who once owned 40% of the float, the math is simpler: cover, or get crushed. If the deal closes as planned, KalVista will end its 11‑year run as a public company, folding into Chiesi’s rare‑disease portfolio.
