Johnson & Johnson announced an agreement to buy Momenta Pharmaceutical Inc., allowing medical corporation entry into the market of a new class of drugs to treat certain autoimmune diseases.
The company will purchase Momenta for roughly $6.5 billion or $52.50 per share in an all-cash transaction. The transaction represents an approximately 70 percent premium to Tuesday’s closing price of $30.81 for Momenta.
Momenta is a Cambridge, Massachusetts based biotechnology company focused on developing treatments of rare immune-mediated diseases.
The acquisition will allow Johnson & Johnson to broaden its presence in immune-mediated diseases and enable it to grow in the autoantibody-driven disease space.
According to Yahoo Finance, the deal benefits Momenta by giving the company a much-needed cash influx and a reliable partner to advance its portfolio of novel drug candidates for autoimmune and rare diseases.
The deal will give Janssen Pharmaceutical Companies, which is part of Johnson & Johnson, full global rights to Momenta’s nipocalimab (M281). This drug is a clinically validated anti-FcRn antibody that is potentially best-in-class.
Nipocalimab is Momenta’s experimental therapy that is being tested for use against myasthenia gravis, a neuromuscular disease that causes muscle weakness, and other conditions such as hemolytic anemia where the immune system attacks the body.
According to a research note released on Aug. 19 and reported on by The Wall Street Journal, Johnson & Johnson acquiring Momenta “secures one of the most clinically advanced FcRn antibodies, and is likely to accelerate development for this molecule.”
Johnson & Johnson said that an estimated 2.5 percent of the global population has an autoantibody-driven disease, many of which are rare diseases.
According to CNBC, Johnson and Johnson hope that nipocalimab will be approved to treat several conditions and eventually bring in blockbuster sales.
“Janssen will have the potential to introduce multiple launches, many as first-in-class indications with potential for significant peak year sales, some of which could exceed $1 billion,” Johnson & Johnson said.
According to analysts at an investment bank focused on the healthcare industry known as SVBLeerink, this new class of autoimmune drugs is estimated to generate sales of up to $25 billion in the U.S. by 2030.
The move by Johnson & Johnson is part of a continuing trend for the healthcare conglomerate. The company unloaded some divisions that manufacture medical devices for diabetes care and has also shifted focus towards bolstering its presence in fast-growing markets such as cancer.
The deal also comes just days after Sanofi, a French company, made a $3.7 billion deal to buy Principia Biopharma Inc. for its autoimmune disease treatments.
The acquisition of Momenta is expected to finish by the end of the year.