Johnson & Johnson JNJ) confirmed that it approached Swiss biotechnology company, Actelion Ltd. ALIOF, with a takeover offer. J&J stated in a press release that it is “engaged in preliminary discussions” with Actelion regarding a possible transaction. However, both J&J and Actelion warned that there is no certainty that the discussions will culminate into any transaction. J&J said it will make additional comments on the topic only when a formal agreement is reached or when it is appropriate to do so.
Actelion’s shares surged nearly 20% on Friday, while J&J’s shares rose 1% on the news. In fact, while the Zacks classified Drugs industry declined 15.8% over the past one-year period, the stock of J&J’s climbed 12.7% while that of Actelion shot up almost 32%.
Last week, Bloomberg reported that the companies were holding initial talks. (Read More: J&J Reportedly Approaches Actelion for Acquisition).
Actelion is a leader in the pulmonary arterial hypertension (PAH) market with key drugs like Opsumit, Tracleer, Ventavis, Veletri and Uptravi. The newer drugs – Opsumit and Uptravi –have been well received and are poised to become blockbuster drugs. These should make up for the lost revenues from Actelion’s older PAH medicine, Tracleer, which is...