J&J Says Crucell Deal May Still Be Renegotiated

Johnson & Johnson left open the possibility of renegotiating the 1.75 billion-euro ($2.3 billion) acquisition of Crucell NV should the Dutch vaccine maker’s manufacturing woes worsen.

The 22.8 million-euro writedown that Leiden, Netherlands- based Crucell took on its vaccine inventory in the third quarter isn’t enough to invalidate the takeover agreement, the companies said in a statement late yesterday. J&J will consider all effects of contamination at a plant in South Korea before deciding whether to complete the acquisition, according to the statement.

The companies agreed to move ahead with the transaction even though Crucell is still investigating the microbiological contamination at the Shingal plant and the full effects won’t be known before the takeover offer begins, according to the statement. Crucell said Oct. 28 it halted shipments of the Quinvaxem vaccine against five childhood diseases and Hepavax- Gene for hepatitis B because of contamination. Crucell withdrew its 2010 forecast.

J&J expects to receive approval from the Dutch market regulator to begin the 24.75 euro-a-share offer for Crucell before a scheduled Dec. 10 informational meeting for Crucell shareholders in Amsterdam, the companies said.

Crucell fell 39 cents, or 1.6 percent, to 23.60 euros in Amsterdam. The stock has risen 70 percent this year, compared with a 2.8 percent return for the Bloomberg Europe Pharmaceutical Index.

Crucell anticipates resuming shipments of non-contaminated Quinvaxem supplies shortly, the companies said. The Shingal plant will return to full manufacturing in February, according to the statement.

The Oct. 6 merger agreement between the companies contains a “material adverse effect” clause that allows J&J to cancel the deal if some unexpected events arise that hurt Crucell’s business.

To contact the reporter on this story: Phil Serafino in Paris at pserafino@bloomberg.net

To contact the editor responsible for this story: Phil Serafino at pserafino@bloomberg.net

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