By Charley Grant

How do you earn an investment return that would make even the luckiest bitcoin speculator blush?

One biotech company has the answer. Endocyte announced Thursday it would sell itself to Novartis for $2.1 billion in cash. The deal was to acquire Endocyte's novel prostate cancer treatment.

That is a great result for Endocyte -- its shares rose 50%. It looks even better when one considers how Endocyte acquired the drug's rights. It bought an exclusive license in October of 2017 for just $12 million in upfront cash, plus an equity grant and future cash incentive payments.

All told, Endocyte earned about 175 times its initial cash outlay in one year. Given that payout, perhaps the Endocyte executives will consider launching a hedge fund once the deal closes.

Write to Charley Grant at charles.grant@wsj.com

(END) Dow Jones Newswires

October 18, 2018 11:21 ET (15:21 GMT)

Copyright (c) 2018 Dow Jones & Company, Inc.
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