Allergan isn’t looking at any large deals, chief executive officer Brent Sanders said, after the drugmaker posted second-quarter sales that fell short of analysts’ estimates.

Revenue at Allergan, which ended its $160bn (€144.25bn) planned merger with Pfizer in April, which was driven by Irish tax considerations, rose 1.5% to $3.68bn last quarter.

That was shy of the $3.72bn average of estimates from analysts. 

While sales of the blockbuster wrinkle treatment Botox soared, revenue from Allergan’s Alzheimer drug Namenda IR slumped 98% after the loss of patent exclusivity.

“Allergan doesn’t need to do any big M&A,” Mr Sanders said yesterday on a conference call about quarterly results. 

“We have a strong pipeline, many of which are late-stage and game-changing potential programmes,” he said.

Allergan’s shares dropped almost 3% yesterday and have fallen 21% this year.

The shares of Biogen, which the Wall Street Journal reported last week was among potential takeover targets for Allergan, dropped 1%.

Mr Sanders’ remarks confirmed a change of approach to M&A following the collapse of the Pfizer deal in April in the face of regulatory hurdles.

Mr Sanders, who has been one of the most active dealmakers in the industry, signalled in June he was hunting for smaller “tuck-in deals” that fit its existing lines of business to boost growth.

Allergan, incorporated in Dublin but has executive offices in New Jersey, completed the $40.5bn sale of its generic drugs business to Teva last week.

Second-quarter earnings excluding some items were $3.35 a share, the company said. Analysts surveyed had predicted $3.31 a share.

Company spokesman Mark Marmur said the sales miss was largely because many analysts, in their estimates, had not taken into account that Allergan is now reporting its Anda generics distribution business as a discontinued operation.

Pfizer dropped plans to buy Allergan after the US government cracked down on so-called inversion deals, in which companies move their domiciles to countries that have a lower tax rate.

The combination would have been the biggest deal ever in the pharmaceutical industry. 

Allergan, which is itself the product of a merger with Actavis, agreed in July to sell its generic-drug business to Israeli drugmaker Teva.

That deal excluded Allergan’s anti-wrinkle treatment Botox plant in Westport, Co Mayo, and another manufacturing plant and a European shared-services centre in Dublin. Across those three operations, Allergan employs about 1,000 people here.

— Bloomberg, Reuters, Irish Examiner


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