Johnson & Johnson is set to invest over $14 billion into the treatment of disorders affecting the central nervous system through the acquisition of Intra-Cellular Therapies.
On Monday, the health care leader announced its intention to purchase shares of Intra-Cellular at $132 in cash each, which illustrates a 39% premium over Intra-Cellular’s closing price of $94.87 on the prior Friday.
Following the announcement, shares of both organizations saw an increase in value.
Intra-Cellular Therapies Inc. is recognized for its medication, Caplyta, which is a once-daily oral treatment designed for adults dealing with schizophrenia and bipolar-related depression.
The company’s revenue from Caplyta reached $175 million in the third quarter of last year, highlighting a 38% rise in total prescriptions during that time.
Intra-Cellular has also disclosed plans to expand its sales force to tap into new growth possibilities, specifically targeting primary care physicians.
Additionally, the company is actively pursuing approval from the U.S. Food and Drug Administration (FDA) to position Caplyta as a supplementary treatment option for adults diagnosed with major depressive disorder.
Market analysts predict that demands for Caplyta will propel its sales to exceed $1 billion by next year and potentially surpass $2.5 billion by 2028, as reported by the data analysis firm FactSet.
Furthermore, Intra-Cellular’s research and development initiatives include efforts to create treatments aimed at alleviating anxiety as well as psychosis and agitation associated with Alzheimer’s disease, which are currently undergoing mid-stage testing.
Based in New Brunswick, New Jersey, J&J plans to finance the acquisition, valued at approximately $14.6 billion, by utilizing a mix of cash and debt.
Both companies anticipate that the acquisition will be finalized later this year.
Intra-Cellular’s announcement aligns with a recent resolution regarding a patent lawsuit determining the timeline for the entry of a more affordable generic version of Caplyta into the U.S. market.
The company revealed that Sandoz Inc. will be permitted to begin marketing a generic formulation by 2040, or possibly sooner, under unspecified conditions.
The agreement is currently under review by federal regulators, and Intra-Cellular has outstanding patent litigation pending in federal court.
Following the news, shares of Intra-Cellular, which is headquartered in Bedminster, New Jersey, spiked about 34% to reach $127.10, while J&J’s stock saw a modest increase of 1%, finishing the day at $143.45.
