Shire to acquire Baxalta in $32 billion deal

Shire has announced that it is to combine with Baxalta in a deal worth approximately $32 billion.

Under the agreement, Baxalta shareholders will receive $18.00 in cash and 0.1482 Shire ADS per Baxalta share.

The combination of Shire and Baxalta will create the number one rare diseases platform in revenue and pipeline depth, with best-in-class products in each of the following growing, multibillion-dollar franchises: Haematology; Immunology; Neuroscience; Lysosomal Storage Diseases; Gastrointestinal / Endocrine; and Hereditary Angioedema (HAE). The combined company will also possess a growing franchise in Oncology, with approved products and innovative compounds in development, as well as a robust late-stage Ophthalmics pipeline.

The combined portfolio will have an expanded range of therapeutic areas with more than 60 programmes in development, including over 50 that will address rare diseases and the newly approved Baxalta products Adynovate, Vonvendi and Obizur. Shire anticipates more than 30 recent and planned product launches from the combined pipeline, contributing approximately $5 billion in annual revenues by 2020.

Expanded geographic reach

Further, the combined company will benefit from expanded geographic reach across more than 100 countries. Through a balanced portfolio and expanded therapeutic expertise and capabilities, the combination will enhance revenue diversification and optionality for the business, while strong cash flows will increase financial and operational scale. In total, the proposed combination will create a sustainable platform for future innovation and growth, yielding projected near- and long-term value for shareholders.

Commenting on the announcement, Shire Chief Executive Officer Flemming Ornskov, M.D., M.P.H., said: “This proposed combination allows us to realize our vision of building the leading biotechnology company focused on rare diseases. Together, we will have leadership positions in multiple, high-value franchises and become the clear partner of choice in rare diseases. Our expanded portfolio and presence in more than 100 countries will drive our growth to over $20 billion in anticipated annual revenues by 2020.”

Baxalta’s Chief Executive Officer Ludwig N. Hantson, Ph.D., added: “Today’s announcement marks a new path forward for our organization and is a testament to the significant progress we have made in achieving our strategic business priorities. This transaction presents a unique opportunity for Baxalta shareholders, who will receive substantial immediate value as well as an ongoing stake in a combined global leader in rare diseases with strong growth prospects.”