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Bloomberg
AbbVie Inc. agreed to buy rival drugmaker Allergan Plc for $63 billion in a deal combining the makers of arthritis drug Humira and wrinkle treatment Botox in a bid to kindle growth.
The takeover, at a value of $188.24 a share, is a 45 percent premium to Allergan’s closing price. Allergan rose 33 percent to $172 in pre-market trading in the US early on Tuesday.
AbbVie has been looking for ways to reinvigorate its pipeline of experimental drugs as Humira, the best-selling medicine in the world, faces competition from cheaper biosimilars. Allergan, which makes Botox, has been considering a split.
The deal comes as drugmakers seek greater scale as they seek innovative new treatments for diseases, which require massive investments to develop but can yield greater payoffs. Meanwhile, pricing of many drugs has come under political pressure in the US.
News of the possible deal comes a day after Bristol-Myers Squibb Co. agreed to divest one of Celgene Corp.’s most lucrative drugs in order to close their planned $74 billion combination. Japan’s Takeda Pharmaceutical Co. earlier this year completed a $62 billion takeover of Shire Plc.
Allergan holders will receive 0.8660 AbbVie shares and $120.30 in cash for each share they hold. The combination will create a company with annual revenue of about $48 billion operating in 175 countries with an industry-leading pipeline of drugs in development, said Brent Saunders, Allergan’s chief executive officer.