swiss drugmaker novartis set to buy the medicines company for about usd 7 billion

Swiss Drugmaker Novartis Set To Buy The Medicines Company For About USD 7 Billion

Business

Swiss drugmaker Novartis is about to seal the deal to buy US biotechnology firm The Medicines Company. According to reports, the deal will reportedly cost it USD 7-8 billion. People privy with the development said that Novartis has expressed its willingness to pay USD 85 a share. This was the price of the New Jersey-based company’s stock a few days back when it was reported that the company was exploring a sale. However, the shares closed on at below USD 70 each on Friday after it dipped to USD 52 when the news about sale first appeared. The deal is expected to be announced in just a couple of days. However, both the Novartis and The Medicines Company have not responded to these reports.

The deal is an attempt of reshaping the Swiss drugmaker by its chief executive officer Vas Narasimhan. This will help Novartis increase its cabinet of heart medicine and support the growth which is under threat by patent expirations. Also, the US drugmaker feels that the takeover will help it in coming out with a new cholesterol-lowering drug Inclisiran. The successful late-stage trial of the drug was present earlier this month. The result showed that the drug reduced the so-called bad cholesterol by up to 58 percent. Drug Inclisiran, which is yet to be approved, is an injection instead of a statin pill. Statin pill is administered daily whereas this injection will be administered every few months.

Sources also said that Novartis has been hunting for a USD 5 billion acquisition in the United States. Earlier this year, Novartis CEO said that he aimed to cap mergers and acquisitions to about 5 percent of the company’s market capitalization. He aimed to do this in order to boost up total shareholder returns. The company’s current market value is pegged at USD 203 billion. This is after series of takeovers and disposals. The recent acquisition was the USD 2.1 billion purchase of the US-based Endocyte and for USD 3.8 billion, French nuclear medicines business Advanced Accelerator Applications.

Leave a Reply

Your email address will not be published. Required fields are marked *