AbbVie announced that it has completed its acquisition of Allergan after receiving regulatory approval from all government authorities required by the transaction agreement and approval by the Irish High Court.
“We are pleased to reach this important milestone for the company, its employees, shareholders and the patients we serve,” Richard A. Gonzalez, chairman and chief executive officer, AbbVie, said in a company news release. “Our new Allergan colleagues should be commended for all their efforts, along with those of our own employees, to achieve this turning point for our company. The new AbbVie will be a well-diversified leader in many important therapeutic categories, with both on-market and pipeline assets, and our financial strength will allow us to continue to invest in innovative science and continue to serve unmet medical needs of patients that rely upon us. I am proud of both organizations and look forward to the opportunities ahead.”
The $63 billion blockbuster acquisition was first announced in June 2019. The deal was announced as AbbVie sought new sources of growth as it braces for the end of patent protection for the world’s top-selling drug, Humira. Humira represents about 60% of AbbVie’s sales and will represent about 40% of the combined company’s sales.
While a main driver of the deal was Allergan’s medical aesthetics business, including Botox, the deal will give AbbVie a presence in eye care. In addition to Restasis, Allergan’s eye care portfolio includes glaucoma drugs Alphagan, Combigan and Lumigan; macular edema and noninfectious uveitis drug Ozurdex, and its Refresh brand OTC drops. Allergan also has several products in its eye care pipeline, including the Bimatoprost SR biodegradable implant for the reduction of IOP, and abicipar for patients with wet AMD.
The transaction expands and diversifies AbbVie’s revenue base and complements existing leadership positions in immunology, with Humira, and recently launched Skyrizi and Rinvoq, and hematologic oncology, with Imbruvica and Venclexta. Allergan provides new growth opportunities in neuroscience, with Botox Therapeutics, Vraylar and Ubrelvy and a global aesthetics business, with leading brands including Botox and Juvederm.
This diversified on-market portfolio will drive the existing AbbVie growth platform (ex-Humira) to approximately $30 billion in revenues in full year 2020, with combined revenues of approximately $50 billion. It also positions the company for enhanced long-term growth potential, a growing dividend and investment in innovation in each of its therapeutic categories. The company anticipates rapidly paying down the incremental debt with its increased operating cash flows.
Additionally, in connection with the closing of the transaction, the AbbVie Board of Directors has elected Thomas C. Freyman, retired Executive Vice President and Chief Financial Officer, Abbott, to join the AbbVie board. Mr. Freyman recently served on the Allergan Board of Directors.
Under the terms of the transaction agreement, Allergan shareholders will receive 0.8660 AbbVie shares and $120.30 in cash for each Allergan share, for a total consideration of $193.23 per Allergan share (based on the closing price of AbbVie’s common stock of $84.22 on May 7, 2020). Allergan common stock ceased trading on the New York Stock Exchange as of the close of trading today.