Physician community speaks out on Allergan buyout bid

As Valeant today increased its proposal for the Allergan merger by about 21% per share, Allergan launched a more pointed defense against the unwanted merger deal.  

In addition to questioning the sustainability of its unwanted suitor’s business model and stock price, Allergan has publicized a strong outpouring of support from its physician customers, as well as patient advocacy groups and medical associations. Allergan has posted more than 500 letters expressing appreciation for Allergan’s many contributions in the fields of research and development, product innovation, market creation, and physician support and services. A letter from the Academy’s CEO, Dr. David W. Parke II, is among the letters of support. .

The revised proposal increases Valeant’s cash consideration by $10 per share, or about 21%, to $58.30. It will also pay 0.83 of a Valeant share. Valeant also said that it would pay up to an additional $25 a share for Allergan’s Darpin eye treatment if the drug meets certain performance thresholds. Valeant is committed to investing up to $400 million in the development of Darpin and retaining current Allergan employees responsible for the product’s development, according to a company release.

The new offer comes on the heels of a separate deal in which Nestlé will buy the sales rights to some of Valeant’s skin care products for $1.4 billion.

Valeant, backed by Pershing Square Capital Management, originally offered on April 22 to pay $48.30 a share in cash and 0.83 of its common share for each Allergan share. Valeant's pursuit of the California-based Allergan is part of its strategy to become one of the five-biggest drug companies by market capitalization by the end of 2016.