Depomed picks up U.S. Nucynta rights as J&J's cast-off moves continue

Johnson & Johnson CEO Alex Gorsky

Earlier this week, once-skeptical Johnson & Johnson ($JNJ) CEO Alex Gorsky seemed to be fully on board pharma's slim-down bandwagon, telling presentation-watchers at the JP Morgan Healthcare Conference he was willing to jettison pieces of the J&J puzzle if they didn't present a "path to achieving leadership." Now, he's followed up with another divestment that will send U.S. rights to pain med Nucynta to California's Depomed.

The company's Janssen unit will nab $1.05 billion from Newark-based Depomed ($DEPO), which will add Nucynta, Nucynta ER and Nucynta oral solution to a pain med arsenal that already includes post-shingles pain therapy Gralise and migraine treatment Cambia. And it's all part of J&J's plan to "focus efforts and resources on targeted growth priorities," Janssen said in a statement.

While it's hardly the large-scale breakup Goldman Sachs analyst Jami Rubin pulled for back in 2012--nor does it approach the scale of slim-down transactions Big Pharma rivals GlaxoSmithKline ($GSK), Novartis ($NVS), Merck ($MRK) and Pfizer ($PFE) have recently engineered--it's the latest in what's become a series of smaller cast-off moves for J&J. Last March, the Brunswick-based company sold sexual lubricant brand K-Y to consumer giant Reckitt Benckiser before inking a $4 billion pact to send its Ortho Clinical Diagnostics unit to the Carlyle Group.

Depomed CEO Jim Schoeneck outside the JP Morgan Healthcare Conference

Depomed, on the other hand, is in the process of bulking up, CEO Jim Schoeneck told FiercePharma at this week's JP Morgan Healthcare Conference. The company, which had already made three deals in the four years since launching its first product, had been scouting for pain drugs with a long patent life and revenue in the $20 million to $200 million range--criteria Nucynta, whose franchise raked in $166 million between September 2013 and September 2014, fits perfectly.

"We believe that Nucynta is an ideal strategic fit for Depomed--a rare opportunity to add a proprietary, differentiated drug with a lengthy period of exclusivity that fits precisely into our therapeutic focus," he said in a statement.

- read Janssen's release
- read Depomed's release

Special Reports: Pharma's top 10 M&A deals of 2014's first half | The top 10 pharma companies by 2013 revenue - Johnson & Johnson | 15 Highest-Paid Biopharma CEOs of 2013 - Alex Gorsky - J&J

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