J&J scoops up Swiss drug maker for $30bn

Ac­qui­si­tion of Acte­lion brings ad­di­tional di­ver­sity

The Star Early Edition - - BUSINESS REPORT | INTERNATIONAL - Jared Hopkins and Jo­hannes Koch

It will make J&J a leader in the treat­ment of pul­monary ar­te­rial hy­per­ten­sion.

JOHN­SON & John­son (J&J) agreed to buy Acte­lion for $30 bil­lion (R400bn) and spin off the Swiss drug maker’s re­search and de­vel­op­ment op­er­a­tions, clinch­ing its largest deal ever to be­come a leader in medicines treat­ing a rare type of high blood pres­sure.

J&J, al­ready the world’s big­gest maker of health­care prod­ucts, is ful­fill­ing its goal of adding a new drug cat­e­gory with the trans­ac­tion and deal­ing a blow to France’s Sanofi, which had also sought to ac­quire Acte­lion.

The deal is ex­pen­sive, com­pared to re­cent in­dus­try takeovers such as Pfizer’s ac­qui­si­tion of Me­di­va­tion and Ab­bVie’s pur­chase of Phar­ma­cyclics, ac­cord­ing to an anal­y­sis from Bloomberg In­tel­li­gence.

J&J will be­gin a ten­der of­fer to buy shares of Allschwil, Switzer­land-based Acte­lion for $280 each in cash, the com­pa­nies said.

The price, which equals 280.08 Swiss francs (R3 728.47), is 23 per­cent above Wed­nes­day’s clos­ing level.

The R&D op­er­a­tions will be spun off to Acte­lion share­hold­ers as a new pub­licly traded com­pany, with J&J keep­ing a 16 per­cent stake.

The deal caps weeks of dis­cus­sions in­ter­rupted for sev­eral days af­ter New Brunswick, New Jer­sey-based J&J walked away on De­cem­ber 13, only to re­turn to the ne­go­ti­at­ing ta­ble about a week later.

Ac­cess to Acte­lion’s drugs Tr­a­cleer, Op­sumit and Up­travi, which all treat life-threat­en­ing pul­monary ar­te­rial hy­per­ten­sion, will make J&J a leader in the dis­ease and help it ex­pand be­yond au­toim­mune, heart and can­cer drugs.

Acte­lion shares surged as much as 22 per­cent in Zurich. They were up 21 per­cent to 275 francs at 9.21am, af­ter hav­ing climbed 68 per­cent since in early Novem­ber. J&J ended Wed­nes­day at $112.80 in New York, cap­ping a 11.5 per­cent in­crease in the past year.

Mean­while, Sanofi is left empty-handed for the sec­ond time af­ter los­ing out on can­cer treat­ment maker Me­di­va­tion to an­other US gi­ant, Pfizer, in Au­gust.

Acte­lion was founded 20 years ago by chief ex­ec­u­tive Jean-Paul Clozel, his wife Mar­tine Clozel and a team of sci­en­tists who split from Roche Hold­ing.

The dis­cov­ery of the block­buster Tr­a­cleer pro­pelled it over a decade ago to be­com­ing a leader in the treat­ment of pul­monary ar­te­rial hy­per­ten­sion. Up­travi and Op­sumit fol­lowed. – Bloomberg


A John­son & John­son build­ing in Irvine, Cal­i­for­nia. The com­pany has ac­quired Swiss drug maker Acte­lion for $30 bil­lion.

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