Valeant Will Buy J&J Drug Unit in Latest Dermatology Deal
Valeant Pharmaceuticals International Inc. (VRX), Canada’s biggest drugmaker, agreed to buy a dermatology unit from Johnson & Johnson (JNJ), the company’s fourth acquisition this year to expand its skin-care franchise.
J&J will be paid $345 million for the Ortho Dermatologics division in a deal expected to add to Valeant’s earnings in 2011, the Mississauga, Ontario-based company said in a statement. The unit generated revenue of about $150 million last year, including sales of prescription medications Retin-A Micro for acne, Ertaczo for athlete’s foot and the Renova wrinkle cream, the statement said.
Valeant, which makes neurology and skin-care drugs, announced a $425 million deal on July 11 for Paris-based Sanofi’s Dermik dermatology business. The Canadian company said in May that it will pay $445 million for Lithuania’s AB Sanitas, which sells skin drugs and hospital-injected medicines in eastern and central Europe, and in June bought North American rights to two skin ointments made by Sweden’s Meda AB (MEDAA) for as much as $206 million.
“With the combination of this transaction and other recently announced transactions, Valeant is well on its way to being one of the leading companies in dermatology,” said J. Michael Pearson, Valeant’s chairman and chief executive officer, in the statement.
Share Moves
Valeant gained $2.39, or 4.5 percent, to $55 at 4 p.m. in New York Stock Exchange composite trading, reaching its highest point since January 2002. The shares have surged 94 percent so far this year. J&J, the world’s second-biggest maker of health- care products after Pfizer Inc., lost 21 cents to $67.45 and is up 9.1 percent this year.
J&J decided to sell “following a review of strategic options,” said Marc Boston, a spokesman for the New Brunswick, New Jersey-based company. “The decision will enable us to focus resources on other key business priorities,” he said, declining to be more specific.
The unit was part of J&J’s Janssen Pharmaceuticals division.
To contact the reporter on this story: Alex Nussbaum in New York anussbaum1@bloomberg.net
To contact the editor responsible for this story: Reg Gale at rgale5@bloomberg.net.
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