This Pharmaceutical Giant Just Poured $11 Billion on an Acquisition. Time to Buy?
AbbVie knows how to plan ahead.
Overview
AbbVie's (NYSE: ABBV) financial results have been strong recently, largely thanks to its key growth drivers, Skyrizi and Rinvoq. However, both of these immunosuppressants will lose patent exclusivity in the next decade. While these patent cliffs are still some ways away, considering the time it takes to develop brand-new therapies, now is as good a time as any for AbbVie to start figuring out how it will overcome them. The company recently made a move in that direction with a massive acquisition. Let's find out whether these recent developments make AbbVie stock a buy.
Image source: The Motley Fool.
On June 22, AbbVie announced that it would acquire Apogee Therapeutics (NASDAQ: APGE), a biotech company focused on developing medicines for immunological and inflammatory diseases. AbbVie will pay about $10.9 billion in cash for this buyout. In exchange, it will inherit a pipeline with several candidates, the most promising of which is zumilokibart, an investigational therapy for eczema. This medicine has performed well in mid-stage studies and could fill an unmet need in this niche. Many patients fail to achieve significant symptom improvement and still have to deal with dry, itchy patches of skin.
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Originally published at www.fool.com.