It was all about AbbVie (ABBV) this past week in the biotech sector with the company finally succeeding in its efforts to make Shire (SHPG) agree to its acquisition proposal. Other news making it to the headlines include encouraging data from Amgen’s (AMGN) pipeline and breakthrough therapy status for InterMune’s (ITMN – Snapshot) lung disease drug.
Amgen’s shares were up 2.5% on positive data on its phase III candidate, AMG 416. AMG 416 is being developed for the treatment of secondary hyperparathyroidism (SHPT) in patients with chronic kidney disease (CKD), receiving hemodialysis.
SHPT is a common and serious condition that is often found in patients with CKD — it is estimated to affect a large number of the 2 million people receiving dialysis across the world. AMG 416 met the primary and secondary endpoints in the study.
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AbbVie, which has been looking to acquire Shire for a while now, finally convinced Shire to accept its proposal late last week. The deal is valued at £31.83 billion or approximately $54.5 billion and makes AbbVie the latest to join a string of U.S. health care companies that have been looking towards overseas acquisitions to lower their tax rates.
AbbVie will not just lower its taxes through this acquisition; it will also boost its product portfolio significantly. This acquisition is very important for the company, which was mainly dependent on a single drug, Humira, for growth. The acquisition will also reduce its dependence on Humira. Humira accounted for approximately 57% of the company’s total revenues in 2013. Humira is set to go off-patent in the U.S. in Dec 2016 and the EU in Apr 2018.
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Apart from the AbbVie deal, it was an uneventful week for the biotech sector with the NASDAQ Biotechnology Index gaining 0.54%. The rest of this week should be highly eventful with several companies like Gilead, Celgene and Alexion expected to report second quarter results.
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