Johnson & Johnson to buy Swiss drug maker Actelion for $30B

Johnson & Johnson CEO Alex Gorsky speaks at the company's shareholder meeting in 2013. J&J announced a $30 billion purchase of Swiss drugmaker Actelion on Thursday. Photo courtesy: Johnson & Johnson

Jan. 27, 2017 (UPI) — U.S. pharmaceutical company Johnson & Johnson has agreed to purchase Swiss competitor Actelion for $30 billion in cash, the companies announced Thursday.

Actelion’s existing drug portfolio will be absorbed by J&J, while its research-and-development work will be spun off into a new company expected to face initial market valuation of $1 billion to $1.5 billion, The Wall Street Journal reported.

Actelion stockholders will receive $280 cash per share, plus a one-to-one interest in the new spinoff. News of the deal sent Actelion’s stock price up 21 percent.

J&J will own an initial 16 percent stake in the new research-and-development company, with an option to purchase an additional 16 percent. It will be led by Actelion CEO Jean-Paul Clozel.

The move comes as New Brunswick, N.J.-based Johnson & Johnson is facing a significant drop-off from its $71.9 billion in sales last year. Its flagship drug Remicade, used to fight autoimmune diseases such as arthritis, stands to lose its patent protection and will face competition from a copycat drug set to be released by Pfizer.

Actelion, Europe’s largest pharmaceutical company in both sales and valuation, first entered into buyout talks with Johnson & Johnson over the summer. Negotiations initially faltered after they became public in November and both sides said they had walked away, with Actelion saying they had begun negotiating with another company for a buyout. The parties returned to the table in December.

Actelion had $851 million in profits for the first nine months of 2016 on revenue of $1.79 billion. It holds patents on several drugs to treat hypertension, including Opsumit, Tracleer, and Uptravi. It also has a number of new drugs to treat a range of conditions nearly ready to go to market, the Journal reported.

Johnson & Johnson stock largely held steady in early trading Thursday, off less than 1 percent, at roughly $112 per share.

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