Humira maker AbbVie is set to acquire Botox maker Allergan in another move toward consolidation for the pharmaceutical industry.
The deal calls for North Chicago, Illinois-based AbbVie to pay cash and stock worth about $63 billion for Dublin-based Allergan.
Together, the companies have projected 2019 revenue of about $48 billion, including AbbVie’s haul from the Humira, a rheumatoid arthritis treatment that qualifies as the world’s best-selling drug.
Their combination comes after failed attempts on behalf of both companies to pull off big acquisitions during the Obama administration, when federal regulators were closely scrutinizing mergers that involved foreign entities for the sake of tax benefits.
Allergan, for example, was set to be acquired by Pfizer in 2016 before that deal was scuttled.
Allergan spun off from Abbott Laboratories in 2013. More recently, the company had been expected to consider a potential split amid looming competition for wrinkle treatment Botox, according to Mizuho Securities analyst Irina Koffler.
AbbVie CEO and Chairman Richard Gonzalez will lead the combined company. Allergan CEO and Chairman Brent Saunders will serve on the combined company’s board.
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The two companies estimated they will save about $2 billion annually by the third year of their combination, including cost cuts.
“With our enhanced growth platform to fuel industry-leading growth, this strategy allows us to diversify AbbVie’s business while sustaining our focus on innovative science and the advancement of our industry-leading pipeline well into the future,” Gonzalez said in a statement.
The deal comes as the latest in a string of acquisitions for the pharmaceutical industry. Other companies making deals recently have included Bristol-Myers Squibb and Eli Lilly.
Follow USA TODAY reporter Nathan Bomey on Twitter @NathanBomey.