|Healthcare Review: Valeant, Novartis, Hospital Corp of America, Allergan, GW Pharmaceuticals|
|By Staff and Wire Reports|
|Tuesday, 22 April 2014 13:32|
David Faber reports Valeant ($VRX) will make a $45B+ hostile bid for Allergan ($AGN), of which 1/3 will be financed with cash. He expects an announcement tomorrow. After factoring a 6% gain in regular trading a 19.7% AH gain, Allergan is currently worth $50.9B..Valeant and Bill Ackman's Pershing Square Capital have each filed 13Ds (I, II) stating Pershing Square now has a 9.7% stake in Allergan. Valeant says it expects to propose a merger with a ~$15B cash component, and that it's contributing $75.9M in working capital to an entity (known as PS Fund 1) to be used by Valeant and Pershing to pursue their bid.
Novartis ($NVS) has agreed to exchange certain assets with GlaxoSmithKline ($GSK) and it is selling its animal-health division to Eli Lilly ($LLY) for around $5.4B.Novartis will buy GSK's oncology products for an initial $14.5B and up to $1.5B in development milestones. The Swiss company will also sell its vaccines business to its U.K. rival for $5.25B upfront and as much as $1.8B in milestones, as well as royalties. The latter deal doesn't include Novartis' flu business, which the company plans to sell separately.
Hospital Corp of America ($HCA) is among a number of suitors interested in acquiring Healthscope, an Australian hospital and pathology company being sold by private-equity owners Carlyle (CG) and TPG, the WSJ reports. A deal could be worth $5B.Other prospective buyers for Healthscope include China's Shanghai Fosun Pharmaceutical and Malaysia's IHH Healthcare (IHHHF).Alternatively, Healthscope could carry out an IPO.
Allergan ($AGN) has had no discussions with Valeant ($VRX) or Bill Ackman's Pershing Square about a possible takeover of the Botox maker, nor has it received an offer. Allergan's board would evaluate any offer that was made, the company said. It was responding to filings by Valeant and Peshing Square about a potential deal.
Shares of cannabinoid biopharmaceutical firm GW Pharmaceuticals ($GWPH) are up 7% after Morgan Stanley initiates coverage with an Overweight rating and $103 PT. Bank of America has a PT of $93, Piper Jaffray has $97 and Leerik Swann $79.The company's lead products are GWP42006 for epilepsy, GWP42004 for Type 2 diabetes and GWP42003 for schizophrenia.GWP42006's active ingredient is the non-psychoactive cannabinoid cannabidivarin extracted from the cannabis plant. A Phase 2 clinical trial should start later this year.