Pharmaceutical company AbbVie, based in Chicago, has won a successful bid to purchase the smaller, specialist company Pharmacyclics. Pharmacyclics manufacturers a drug to treat blood cancers. The winning price was some $21 billion. AbbVie offered to pay $261.25 per share in cash and stock. The deal between AbbVie and Pharmacyclics is slated to close in the middle of this year, according to The New York Times.
The outcome apparently surprised watchers of the pharmaceutical market, as it was expected that the big player Johnson & Johnson would win out.
Pharmacyclics was considered worth the multi-billion dollar bid because it produces a drug called Imbruvica (generic name ibrutinib). This is an anticancer drug that can treat chronic lymphocytic leukemia and mantle cell leukemia. Moreover, the drug is currently being investigated for its ability to treat other B-cell cancers.
Global sales of the Pharmacyclics drug are expected to reach $5.8 billion by 2020, according to estimates compiled by intelligence firm Thomson Reuters Cortellis.
Discussing the bid, AbbVie Chief Executive Richard Gonzalez said in the statement: “Imbruvica is not only complementary to AbbVie’s oncology pipeline, it has demonstrated strong clinical efficacy across a broad range of hematologic malignancies.”
The deal is the first major acquisition for AbbVie since its $54 billion bid to buy Irish drugmaker Shire fell through. This was a result of changes to U.S. tax rules, which were made tougher during 2014. This issue was reported by Digital Journal last year.
Although Johnson and Johnson lost out, the company currently sells the Imbruvica drug abroad and this deal could well continue post-sale.
