Johnson & Johnson in Negotiations to Buy Crucell

Johnson & Johnson (J&J, New Brunswick, NJ) announced last week that it was in “advanced negotiations” for a potential public offer for the Dutch biopharmaceutical company Crucell (Leiden, The Netherlands). Although it had not yet made a formal bid, J&J was considering an offer of EUR 24.75 ($32.49) per share for Crucell in an all-cash transaction of approximately EUR 1.75 billion ($2.30 billion) to acquire all the shares of Crucell that it does not already own. J&J now holds a 17.9% stake in the company. If the deal proceeds as planned, the move would enable J&J to develop a vaccine business, something the company is seeking to build within its biopharmaceutical capabilities.

In making the announcement, J&J said in that “Crucell’s strength in the manufacture, discovery, and commercialization of vaccines would create a strong platform for Johnson & Johnson.” Crucell focuses on the research, development, production, and marketing of vaccines, proteins, and antibodies. In 2009, Crucell distributed more than 115 million doses of vaccine, which now largely go to the developing world, and which includes Quinvaxem, an important vaccine in the company’s revenue position. Quinvaxem is a pediatric combination vaccine against five childhood diseases (i.e., diphtheria, tetanus, pertussis, hepatitis B, and Haemophilus influenzae type B (hib)). In August 2009, Crucell announced contracts worth $300 million through 2010–2012 for Quinvaxem, which were in addition to the $500 million in contracts obtained by the company during 2007–2009, according to a Crucell press release.

Other products in Crucell’s portfolio include a vaccine against hepatitis B, a virosome-adjuvanted influenza vaccine, an oral anti-typhoid vaccine, an oral cholera vaccine, and an aluminum-free hepatitis A vaccine. Crucell’s main vaccine technologies include cell-culture, recombinant live adenovirus vector-based, virosome, recombinant Paramyxovirus (i.e., recombinant measles vectors), and an expression system based on Hansenula polymorpha technology. DSM Biologics (Heerlen, The Netherlands) has co-exclusive rights with Crucell to license the PER.C6 human cell line as a production platform for recombinant proteins and monoclonal antibodies. Crucell also licenses the PER.C6 technology to J&J and other biopharmaceutical companies.

If the deal proceeds, J&J expects that it will maintain Crucell’s existing facilities, retain its senior management, and generally maintain current employment levels. J&J says it would also keep Crucell as the center for vaccines within J&J’s pharmaceutical group and retain Crucell’s headquarters in Leiden.