AbbVie announced its intention to buy Allergan for approximately $63 billion. The move is meant to reduce its reliance on the blockbuster Humira as it will face patents ending in the U.S. in 2023.
AbbVie CEO Richard Gonzalez will lead the combined company and remain chairman and chief executive through 2023. Allergan CEO Brent Saunders will join AbbVie’s board when the deal is complete.
According to Gonzalez, this move is not a pipeline-driven transaction. Both companies revealed that a possible deal was in discussion since late April.
AbbVie expects annual pretax savings and other cost reductions of at least $2 billion in its third year, after the deal closes in early 2020.
The companies said the transaction will add 10% to adjusted earnings per share over the first full year following the close.
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