AbbVie's New $9B Neuroscience Space Deal Might Attract FTC Scrutiny, Analyst Signals

Wednesday, AbbVie Inc ABBV agreed to acquire Cerevel Therapeutics Holdings Inc CERE for a total equity value of approximately $8.7 billion, or $45 per share in cash, with the transaction anticipated to close in the middle of 2024.

The deal comes just a couple of days after AbbVie agreed to acquire ImmunoGen Inc IMGN for $31.26 per share in cash, equivalent to a total equity value of approximately $10.1 billion. 

William Blair highlights AbbVie's clear interest in expanding its foothold in neuroscience, as evidenced by their expressed intent. 

The Cerevel deal aligns seamlessly with its established strategy, introducing a portfolio of five clinical-stage and two preclinical candidates targeting various ailments like schizophrenia, Parkinson's disease (PD), and mood disorders. This strategic move is anticipated to fuel growth from the latter part of this decade well into the 2030s.

However, the potential scrutiny from the Federal Trade Commission (FTC) remains a significant concern for analysts. 

Given that Vraylar, estimated to generate $2.7 billion in revenue in 2023, is approved for schizophrenia, bipolar I disorder, and adjunctive major depressive disorder, it wouldn't be surprising if the deal undergoes FTC examination.

AbbVie already boasts an approved PD product (Duopa/Duodopa) yielding approximately $450 million in annual revenue and anticipates approval for ABBV-951 (subcutaneous levodopa/carbidopa) in the first half of 2024, further strengthening its position in this therapeutic area.

Price Action: ABBV shares are up 1.06% at $147.94 on the last check Thursday.