Johnson & Johnson has opened the J.P. Morgan Healthcare Conference with a bang, buying out Intra-Cellular Therapies for $14.6 billion.
At $132 per share, J&J paid a 39% premium on Friday’s closing price of Intra-Cellular, a New York City-based biotech that develops and markets products for the central nervous system. The takeover comes after Bloomberg reported Sunday that a deal was in the works.
The 23-year-old company has been on an upward trajectory, with its market cap doubling from the end of 2022 to its current $10 billion.
Intra-Cellular reported revenue of $481 million for the first three quarters of 2024, which was up 45% year over year on sales of schizophrenia and bipolar treatment Caplyta, which continues to post eye-opening data and is in line to gain approval to treat major depressive disorder, which could be its most lucrative indication.
Intra-Cellular made noise last week when its share price jumped from $82.56 on Wednesday to its Friday close at $94.87. A patent settlement—announced last week—gives Caplyta market exclusivity until 2040 as opposed to 2036.
When the settlement was announced, it prompted Mizuho analyst Graig Suvannavejh, Ph.D., to write in a note to investors that it “should provide not only an immediate boost to Caplyta’s prospects, but bigger picture, also to [Intra Cellular's] prospects as a potential strategic target.”
With the ruling, Suvannavejh said it added $10 billion to Caplyta’s potential sales ability over its lifetime on the market. He also jacked up his projection of Caplyta’s peak sales potential to $6 billion.
“Johnson & Johnson has a longstanding commitment to neuroscience, and we believe together, we can reach even more patients around the world,” Intra-Cellular CEO and Chairman Sharon Mates, Ph.D., said in a release.
The acquisition is the largest in the biopharma industry since February 2024, when Novo Nordisk forked over $16.5 billion for CDMO powerhouse Catalent. It also is the largest for a biotech since March 2022, when Pfizer snapped up Seagen for $43 billion.
“This acquisition further differentiates our portfolio, serves as a strategic near- and long-term growth catalyst for Johnson & Johnson and offers compelling value to patients, health systems and shareholders,” J&J CEO Joaquin Duato said in a release.
The deal comes after J&J pulled off two major medtech acquisitions, buying out Shockwave Medical last year for $13.1 billion and heart pump maker Abiomed for $16.6 billion in 2022. J&J’s largest deal came in 2017 when it ponied up $30 billion for Actelion.