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Allergan bought by AbbVie in multi-billion dollar deal

03/07/2019By Callum Glennen
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US biopharmaceutical company AbbVie has entered into an agreement to acquire Allergan for approximately US$63 billion (AU$90 b). The deal is one of the largest takeovers in the pharmaceutical industry this year.

Allergan, the company behind popular dry eye drug Restasis, will have its entire product portfolio transferred to AbbVie in order to contribute to the company’s future sustainability.

“The combination of AbbVie and Allergan increases our ability to continue to deliver on our mission to patients and shareholders,” Mr Richard Gonzalez, chairman and CEO of AbbVie, said.

“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.”

Richard Gonzales
Richard Gonzales
“The combination of AbbVie and Allergan increases our ability to continue to deliver on our mission to patients and shareholders”
Richard Gonzalez, AbbVie

The deal significantly expands AbbVie’s line of products. The drug maker produces rheumatoid arthritis treatment Humira which was, according to Genetic Engineering & Biotechnology News, the US’ top selling prescription drug last year. However, the company is set to lose its exclusivity of the drug in 2023, and is now focussing on securing its future portfolio and development capacity.

Allergan has faced several challenges of its own over recent times. Last year the company laid off more than 1000 employees following failed efforts to protect patents surrounding Restasis.

“With 2019 annual combined revenue of approximately US$48 billion (AU$68 b), scale in more than 175 countries, an industry-leading R&D pipeline and robust cash flows, our combined company will have the opportunity to make even bigger contributions to global health than either can alone,” Mr Brent Saunders, chairman and chief executive officer of Allergan, said.

“Our fast-growing therapeutic areas, including our world class 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.”

As per the terms of the deal, AbbVie’s headquaters will remain in Chicago, with Gonzalez serving as CEO. Two members of Allergan’s board, including Saunders, will join AbbVie’s board once the transaction is completed.

Completion of the deal still depends on approval of regulators and Allergan’s shareholders.

 

More reading:

Allergan to cut more than 1000 jobs
Major retailers sue Allergan over Restasis
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