Amgen buys Horizon for $27.8 billion to expand rare disease portfolio

Amgen Inc will buy rare disease drugmaker Horizon Therapeutics Plc in a deal valued at $27.8 billion, which will help the biotech bolster its rare disease portfolio and mark the industry’s largest acquisition this year.

The company will pay $116.50 in cash for each Horizon share, representing a premium of almost 20% over the last closing.

With the deal, Amgen is acquiring several approved drugs, which could help offset the impact of increasing competition from new treatments for its best-selling arthritis drug, Enbrel. Enbrel and other drugs are expected to lose patent protection in the coming years.

The deal should help Amgen get closer to its 2030 sales target, according to Evan Seigerman, an analyst at BMO Capital Markets.

Amgen became the sole bidder after rivals Sanofi and Johnson & Johnson withdrew their bids.

Horizon shares were up 14.4% at $111.37. The shares had gained 23.5% as of Friday’s close, after the company said in late November that it was in preliminary talks with Amgen, Sanofi and Johnson & Johnson for possible takeover offers.

Amgen shares fell 2.4% to $272.

The thyroid eye disease treatment Tepezza is Horizon’s best-selling drug, generating net sales of $1.66 billion in 2021, while Krystexxa, which is used to treat gout not controlled by other medications, brought in sales of US$565.5 million.

Sales of Amgen’s Enbrel have declined over the past four quarters, falling 14% in the most recent quarter on record, to $1.1 billion.

The offer values ​​Horizon at $27.8 billion on a fully diluted basis, according to the company, which includes the common shares to be issued. According to Reuters calculations, the offer values ​​Horizon at $26.4 billion.

Amgen has entered into a $28.5 billion debt agreement with Citibank and Bank of America in connection with the transaction.

The offer values ​​Horizon at $28.3 billion, including debt.

Source: Reuters