Abbott to Acquire Alere, becoming leader in point of care testing

AbbottAbbott (NYSE: ABT) and Alere Inc. (NYSE: ALR) announced today a definitive agreement for Abbott to acquire Alere, significantly advancing Abbott's global diagnostics presence and leadership. Under the terms of the agreement, Abbott will pay $56 per common share at a total expected equity value of $5.8 billion. Once the transaction is completed, Abbott will become the leading diagnostics provider of point of care testing. Abbott's total diagnostics sales will exceed $7 billion after the close.

Abbott will be able to provide new, flexible, cost-effective, high-quality products to help health systems meet growing demand in both in-patient and out-patient settings. Alere's complementary portfolio of products will provide Abbott access to new channels and geographies, including entry into fast-growing outlets, such as doctors' offices, clinics, pharmacies and at-home testing.

"The combination of Alere and Abbott will create the world's premier point of care testing business and significantly strengthen and grow Abbott's diagnostics presence," said Miles D. White, chairman and chief executive officer, Abbott. "We want to offer our customers the best and broadest diagnostics solutions. Alere helps us do that."

Upon completion of the transaction, the combined business will offer the broadest point of care menu of infectious disease, molecular, cardiometabolic and toxicology testing, expanding Abbott's platforms to include benchtop and rapid strip tests. Abbott will be able to better serve an expansive customer base around the world while also accelerating innovation in point of care diagnostics. More than half of Alere's $2.5 billion in sales are in the U.S. Alere also has a growing presence in key international markets, where Abbott's capabilities and infrastructure will drive accelerated growth of Alere's portfolio.

"Today's announcement marks an exciting and transformative milestone for Alere and one that provides an immediate benefit for our stockholders," said Namal Nawana, president and chief executive officer, Alere. "Our leading platforms and global presence in point-of-care diagnostics, combined with Abbott's broad portfolio of market-leading products, will accelerate our shared goal of improving patient care. I'd like to thank our global workforce of nearly 10,000 employees whose hard work and dedication has enabled Alere to contribute to improved patient outcomes throughout the world."

Financial
The transaction will be immediately accretive to Abbott's ongoing earnings per share upon close and significantly accretive thereafter, with approximately 12-13 cents of accretion in 2017 and more than 20 cents in 2018.* The combination is anticipated to result in annual pre-tax synergies approaching $500 million by 2019 and increasing thereafter, including both sales and operational benefits.

Under the terms of the agreement, Alere shareholders will receive $56 per common share in cash at the completion of the transaction, and Alere will become a subsidiary of Abbott. Alere's net debt, currently $2.6 billion, will be assumed or refinanced by Abbott.

The transaction, which has been approved by the boards of directors of Alere and Abbott, is subject to the approval of Alere shareholders and the satisfaction of customary closing conditions, including applicable regulatory approvals.

Evercore is acting as financial advisor and Kirkland & Ellis LLP is serving as legal counsel to Abbott. JP Morgan is acting as financial advisor and Cravath, Swaine & Moore is serving as legal counsel to Alere.

Point of Care Testing
Point of care testing helps improve outcomes and increase the speed of care by bringing the test results to the physician and patient's side in a matter of minutes. The demand for point of care testing is accelerating as health care providers and consumers look for better ways to get fast, accurate and actionable information to guide decision-making. In fact, point of care testing is a $5.5 billion segment and one of the fastest growing in vitro diagnostics segments, in part because many health care systems are increasing their reliance on these technologies to inform patient care decisions because of their ease of use, speed and accuracy.

About Alere
Headquartered in Waltham, Mass., Alere is the global leader in point of care diagnostics with annual sales of $2.5 billion. Alere delivered more than 1.4 billion tests at the point of care in 2015. Its fast, easy-to-use and cost-effective tests are focused on the areas of infectious disease, molecular, cardiometabolic and toxicology. In addition to tests for infections such as HIV, tuberculosis, malaria and dengue that can benefit people in remote care settings, Alere develops simple, rapid tests, including Alere i, the first molecular CLIA-waived test for flu and strep, that delivers results in under 15 minutes.

About Abbott's Diagnostics Business
Abbott is a global leader in in vitro diagnostics offering a broad portfolio spanning immunoassay, clinical chemistry, hematology, blood screening, molecular and point of care. Abbott's 2015 worldwide diagnostics sales were $4.6 billion in 2015, including $473 million from its point of care business. Abbott's leading handheld device, i-STAT, measures 26 analytes with two to three drops of blood and is used in more than one-third of all U.S. hospitals and emergency rooms.

About Abbott
Abbott is a global healthcare company devoted to improving life through the development of products and technologies that span the breadth of healthcare. With a portfolio of leading, science-based offerings in diagnostics, medical devices, nutritionals and branded generic pharmaceuticals, Abbott serves people in more than 150 countries and employs approximately 74,000 people.

Most Popular Now

A step closer to cancer precision medicine

Researchers from the Faculty of Medicine and the Institute for Molecular Medicine (FIMM) at the University of Helsinki have developed a computational model, Combined Esse...

Artificial Intelligence algorithm can learn the la…

Artificial Intelligence can be used to predict molecular wave functions and the electronic properties of molecules. This innovative AI method developed by a team of resea...

Amgen completes acquisition of Otezla® (apremilast…

Amgen (NASDAQ:AMGN) today announced the successful completion of its acquisition of worldwide rights to Otezla® (apremilast), the only oral, non-biologic treatment for mo...

Bristol-Myers Squibb completes acquisition of Celg…

Bristol-Myers Squibb Company (NYSE:BMY) has completed its acquisition of Celgene Corporation (NASDAQ:CELG) following the receipt of regulatory approval from all governmen...

Amgen and the Duke Clinical Research Institute ann…

Amgen (NASDAQ:AMGN) in collaboration with the Duke Clinical Research Institute (DCRI) announced plans to initiate the Cardiovascular Multi-dimensional Observational Inves...

Statins not associated with memory or cognition de…

Given consumer concern that statins may be associated with memory or cognitive decline, a new study published today in the Journal of the American College of Cardiology m...

Novartis announces new strategy to provide innovat…

Novartis announced a new strategy to broaden patient reach and availability of its portfolio of medicines in sub-Saharan Africa (SSA), which is home to the largest unders...

New advances in the treatment of advanced lung can…

The University of Barcelona (UB) and Hospital Clínic de Barcelona collaborate with Boehringer Ingelheim Inc. to improve the efficiency of nintedanib, an antiangiogenic an...

FDA grants priority review to Roche’s risdiplam fo…

Roche (SIX: RO, ROG; OTCQX: RHHBY) announced that the U.S. Food and Drug Administration (FDA) has accepted the New Drug Application (NDA) and granted Priority Review for ...

A protein tag to study the immune system

Researchers from VIB-UGent Center for Medical Biotechnology, University of Iowa (USA) and other collaborators, developed a novel approach to better understand a basic def...

Bayer and Dewpoint Therapeutics partner to researc…

Bayer and Dewpoint Therapeutics, a biotechnology company with sites in Boston and Dresden, Germany, today announced an option, research and license agreement worth up to ...

Pharmacist-led interventions may help prevent card…

With their expertise in the safe and effective use of medications, pharmacists can help in the management of chronic diseases. A review and analysis published in the Brit...