AbbVie buying out Imbruvica drugmaker

AbbVie will spend about $21 billion to buy fellow drugmaker Pharmacyclics and add another major revenue producer to a portfolio that already includes the world’s top-selling drug.

The deal will give the North Chicago, Illinois, drugmaker Imbruvica, a blood cancer treatment that Pharmacyclics makes and then markets with Johnson & Johnson’s Janssen Biotech. AbbVie executives told analysts Thursday that their company could reap more than $7 billion in annual sales from Imbruvica in a few years.

Imbruvica is approved in more than 40 countries and treats three different types of blood cancers including chronic lymphocytic leukemia, which is the most common leukemia in adults. The once-a-day capsule works by blocking a protein that allows the cancer to multiply and spread.

AbbVie Chairman and CEO Richard Gonzalez told analysts Thursday that the drug comes with “vast potential.”

AbbVie plans to increase sales for Imbruvica’s already approved uses, add new uses and make it more of a first-line treatment, which basically means it’s the initial thing doctors try when treating a patient. That represents a bigger revenue opportunity.

While AbbVie touted the potential benefits of its latest acquisition attempt, several analysts said the deal price surprised them, and investors pushed the price of AbbVie stock down Thursday.

Gonzalez told investors that AbbVie outbid two other companies to pull off the Pharmacyclics deal, which was announced late Wednesday. He didn’t name the other two.

AbbVie’s winning bid amounted to an offer of $261.25 for each Pharmacyclics share. That represents a premium of about 21 percent to the closing price of Pharmacyclics shares Tuesday.