AbbVie to acquire Allergan for $63bn
US drug maker AbbVie has agreed to buy Allergan, the Ireland-headquartered maker of Botox, for $63 billion, in the latest blockbuster deal for the pharmaceutical industry.
The deal, which was announced today, June 25, is expected to create a company with annual revenues of approximately $48 billion.
Brent Saunders, chairman and CEO of Allergan, said that Allergan’s fast-growing therapeutic areas, including its medical aesthetics, eye care, central nervous system and gastrointestinal businesses, will “enhance AbbVie's strong growth platform and create substantial value for shareholders of both companies”.
Abbvie shareholders will own approximately 83% of the company after the acquisition closes, with Allergan shareholders owning 17%.
With headquarters in Chicago, Richard Gonzalez, chairman and CEO of AbbVie, will lead the company. Two members of Allergan's board, including Saunders, will join AbbVie's board.
Gonzalez said: "The combination of AbbVie and Allergan increases our ability to continue to deliver on our mission to patients and shareholders.
“With our enhanced growth platform to fuel industry-leading growth, this strategy allows us to diversify AbbVie's business while sustaining our focus on innovative science and the advancement of our industry-leading pipeline well into the future."
According to AbbVie, the transaction helps the company reduce its dependence on AbbVie’s arthritis treatment Humira (adalimumab).
Humira is expected to face generic competition when the drug goes off-patent in 2023 in the US, and it’s already facing competition in Europe.
“Its ability to deliver immediate scale to the AbbVie growth platform with Allergan's on-market diversified product portfolio meets our strategic goal to reduce reliance on Humira and allows us to continue expanding our focus on high-innovation science throughout the next decade,” said AbbVie.
The transaction is expected to close in early 2020.
Last year, Allergan confirmed that it was in the early stages of considering making an offer for Ireland-based Shire. However, that same day, Allergan announced that it would not be making a bid.
Just over one year ago, in another big deal in the industry, Japanese company Takeda revealed that it would buy Shire for $62 billion.
Earlier this year, in January 2019, American pharmaceutical company BMS announced its plan to purchase drug manufacturer Celgene in a $74 billion deal.
Did you enjoy reading this story? Sign up to our free newsletters and get stories like this sent straight to your inbox.
