Johnson & Johnson to Expand Neuroscience Portfolio with US$14.6 Billion Acquisition

Pharmaceutical giant Johnson & Johnson (J&J) (NYSE:JNJ) has announced plans to acquire Intra-Cellular Therapies (NASDAQ:ITCI) in a US$14.6 billion deal, marking the largest acquisition for the sector in over two years.

The purchase, which is expected to close later this year pending regulatory and shareholder approvals, will give J&J access to Intra-Cellular's portfolio of treatments for neuropsychiatric and neurodegenerative disorders.

This includes Caplyta (lumateperone), an oral therapy for schizophrenia and bipolar depression that has been approved by the US Food and Drug Administration. Net product sales for Caplyta came in at US$175.2 million in the Q3 2024, a 39 percent increase year-on-year, with Intra-Cellular raising its annual guidance to US$665 million to US$685 million.

The move will strengthen J&J’s focus on treatments for brain disorders, aligning with its long-term strategy of enhancing its pharmaceutical business following the 2023 spinoff of its consumer health division.

J&J has agreed to pay US$132 per share in cash for Intra-Cellular, representing a 39 percent premium over the company's closing share price before the announcement. Intra-Cellular rose by 34 percent in response to the news on Monday (January 13), while shares of J&J experienced a modest 1.5 percent gain that day.

Joaquin Duato, J&J's CEO, emphasized to shareholders that the deal will enhance the company’s ability to deliver transformative treatments for neuropsychiatric and neurodegenerative disorders.

“Building on our nearly 70-year legacy in neuroscience, this unique opportunity to add Intra-Cellular Therapies to our Innovative Medicine business demonstrates our commitment to transforming care and advancing research in some of today’s most devastating neuropsychiatric and neurodegenerative disorders,” he said a press release.

Caplyta stands out for its safety and efficacy profile, with ongoing Phase 3 trials exploring its potential in major depressive disorder (MDD) and bipolar mania. If approved for MDD, Caplyta could become a standard of care, filling a gap in treatment options for one of the most prevalent mental health conditions globally.

In addition to Caplyta, J&J will gain access to Intra-Cellular's pipeline, which includes ITI-1284, a Phase 2 drug candidate targeting generalized anxiety disorder and Alzheimer’s-related psychosis.

J&J is scheduled to provide further financial details during its Q4 earnings call on January 22.

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Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.