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Actavis to acquire Allergan in $66 billion transaction
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Actavis plans to acquire Allergan in a transaction valued at $66 billion, or $219 per share in cash and Actavis shares.
The acquisition would create a top 10 global growth pharmaceutical company with $23 billion in anticipated revenue, Allergan announced in a press release.
The transaction is expected to be completed in the second quarter of 2015, the release said.
The boards of directors of Actavis and Allergan unanimously approved the transaction, which is also supported by management teams of both companies.
The deal’s completion is contingent on the approval of both companies’ shareholders and antitrust clearance in the U.S., European Union and other jurisdictions.
“We will establish an unrivaled foundation for long-term growth, anchored by leading, world-class blockbuster franchises and a premier late-stage pipeline that will accelerate our commitment to build an exceptional, sustainable portfolio,” Brent Saunders, CEO and president of Actavis, said in the release. “The combined company will have a strong balance sheet, growing product portfolios and broad commercial reach extending across 100 international markets. Our combined experienced management team is dedicated to driving strong organic growth while capturing synergies and maintaining a robust investment in strategically focused R&D.”
In a conference call hosted by Actavis, Saunders emphasized the combined company’s commitment to generic drug lines.
“We are absolutely committed to generics because we are best in class in generics. We have the best, fastest-growing generic business in the world with the absolute best pipeline,” Saunders said.
He said that the company will cut $400 million in research and development costs, down from $900 million that Valeant would have cut.
Saunders also that the combined company will have an extensive product portfolio, which includes DARPin, Ozurdex (dexamethasone intravitreal implant), Restasis (cyclosporine ophthalmic emulsion), Lumigan (bimatoprost ophthalmic solution) and Botox (onabotulinumtoxinA).
David Pyott, chairman and CEO of Allergan, noted some other leading specialty products in the combined portfolio, such as Natrelle breast implants, dermal/facial fillers, Juvéderm, Latisse and Asacol.
U.S. Food and Drug Administration approval of DARPin is expected in late 2018 or early 2019, Pyott said.
Pyott noted that the company will become an important player in the retina market, with approval of Ozurdex in the U.S. and European Union.
“I think one of the great upsides in this business is the combined portfolio. We have well over 20 late-stage products that we will launch over the next few years and several that we will launch next year,” Saunders said.
Valeant Pharmaceuticals, which has tried to acquire Allergan since April, issued a reaction to the Actavis acquisition.
“We have seen the announcement that Allergan and Actavis have made, and while we will review any such agreement in determining our course of action, Valeant cannot justify to its own shareholders paying a price of $219 or more per share for Allergan,” J. Michael Pearson, chairman and CEO of Valeant, said in a press release.