J & J to buy Actelion for $30 bn, spin off R&D unit

ZURICH: US healthcare giant Johnson & Johnson will acquire Swiss biotech company Actelion in a $30 billion all-cash deal that includes spinning off Actelion’s research and development pipeline, the companies said on Thursday.
The acquisition gives J&J access to the Swiss group’s line-up of high-price, high-margin medicines for rare diseases, helping it diversify its drug portfolio as its biggest product, Remicade for arthritis, faces cheaper competition.
The offer to pay $280 per share, following weeks of exclusive talks, was unanimously approved by the boards of directors of both companies.
The deal represents a 23 per cent premium to Actelion’s closing price on Wednesday of 227.4 Swiss francs and is more than 80 per cent above the Nov. 23 closing price before initial reports emerged that Europe’s biggest biotech company had attracted takeover interest.
Actelion shares jumped 20.5 per cent to 274 francs by 0830 GMT.
“The price is quite high at around 30 times price to estimated 2018 earnings. J&J is paying a lot and R&D is not even included, just a substantial minority stake,” one Zurich-based trader said. Jefferies analysts said they did not expect any counterbids or competition concerns to derail the deal.
Actelion has been the subject of takeover speculation for weeks after J&J launched and then halted discussions with the Swiss company. French drugmaker Sanofi had also been interested, sources said, but was sidelined after J&J returned and began exclusive negotiations in December. Sanofi’s failure to come away with a big deal for a second time has added to pressure on its management. — Reuters