J&J, Biotech Firm In $6.5 Billion Deal J&J Agrees to Buy Biotech Company -- WSJ

By Peter Loftus and Colin Kellaher

This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (August 20, 2020).

Johnson & Johnson said Wednesday it agreed to buy drugmaker Momenta Pharmaceuticals Inc. for about $6.5 billion, giving J&J entry into a potentially big-selling new class of drugs to treat certain autoimmune diseases.

The deal price of $52.50 per share cash represents a roughly 70% premium to Tuesday's closing price of $30.81 for Momenta, a Cambridge, Mass., biotechnology company focused on developing treatments of rare immune-mediated diseases.

J&J, of New Brunswick, N.J., has built up a lucrative business selling treatments for autoimmune diseases such as rheumatoid arthritis and psoriasis, with drugs including Remicade and Stelara. But growth has slowed in recent years because of competition from copies of Remicade.

By acquiring Momenta, J&J gains access to an experimental drug, nipocalimab, which Momenta has been studying for several rare autoimmune diseases, including a type of anemia known as warm autoimmune hemolytic anemia. J&J said the deal would broaden the position of its Janssen Pharmaceutical unit in immune-mediated diseases and allow the unit to expand into autoantibody-driven disease.

Nipocalimab is one of a newer class of autoimmune drugs known as FcRn antibodies, which several other companies including Alexion Pharmaceuticals Inc. are developing.

Analysts at SVBLeerink, an investment bank focused on the health-care industry, estimated that this new class of autoimmune drugs could generate sales of $20 billion to $25 billion in the U.S. by 2030.

J&J's acquisition of Momenta "secures one of the most clinically advanced FcRn antibodies, and is likely to accelerate development for this molecule," the analysts said in a research note Wednesday.

Momenta's nipocalimab recently received a rare-pediatric-disease designation from the U.S. Food and Drug Administration for the prevention of hemolytic disease of the fetus and newborn, a serious blood disorder.

J&J gains full global rights to the drug, as well as Momenta's pipeline of other experimental drugs. J&J said the deal could yield new drugs with potential annual sales exceeding $1 billion.

Johnson & Johnson said it expects to complete the acquisition by the end of the year. It reiterated its full-year earnings-per-share forecast, which includes a modest dilution from the Momenta deal.

Shares of Momenta surged 69% to $52.14 in trading Wednesday.

Write to Peter Loftus at peter.loftus@wsj.com and Colin Kellaher at colin.kellaher@wsj.com

(END) Dow Jones Newswires

August 20, 2020 02:47 ET (06:47 GMT)

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