Allergan, the maker of Botox, sold yesterday for a reported $66 billion. The move by Ireland’s Actavis Plc marked the end of a hostile pursuit of Allergan by William Ackman and Valeant Pharmaceuticals International Inc.
Allergan had resisted the takeover by Valeant on the grounds that it would hurt its shareholders, given the Canadian pharma company’s history of acquiring companies and then quickly cutting research & development investments. Not surprisingly, after the deal with Actavis went public Allergan’s stock rose 5.3%, closing at $209.20. Actavis’ stock rose as well, climbing 1.7% to $247.94.
It should be noted that Actavis’ takeover does not come without R&D cuts. However, the $400 million pales in comparison to the alleged $900 million in cuts that Valeant had proposed.
The goal is to integrate the operations of Allergan with Actavis, as well as keep growing the cutting-edge, yet experimental, eye treatments for sufferers of macular degeneration and glaucoma.
The move is not expected to affect the price of Botox in any way. Botox still remains the king of the wrinkle reduction, despite the rise in other promising cosmetic injectables.