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J&J strengthens biotech business

Published on 24/10/03 at 05:03pm

 Johnson & Johnson is to expand its biotech capabilities with a $2.4 billion purchase of US company Scios.

The deal, still subject to regulatory and Scios Shareholder approval, will give J&J access to Scios' Natrecor, the first new agent for over a decade to treat congestive heart failure (CHF), and SCIO-469, a new type of kinase inhibitor to treat rheumatoid arthritis, in phase II trials.

Scios also has a series of molecules that block tumour growth factor-beta, which is thought to be involved in a variety of diseases, such as CHF, COPD, liver cirrhosis and kidney disease. The company hopes two of these compounds will progress through pre-clinical development.

"Scios strengthens our growing cardiovascular franchise and broadens our pipeline with several new potential chemical entities", said Christine Poon, Worldwide Chairman of J&J's Pharmaceutical Group. "Natrecor is a truly unique product for a largely underserved and growing market. Scios also brings and advanced research program on kinase inhibitors, which is an exciting area of research".

J&J has been shifting towards biotech over the last few years. It already owns Centocor, which developed the arthritis and Crohn's disease treatment Remicade, and Ortho Biotech Products, which was involved in the discovery and development of J&J's top selling drug, the anaemia therapy Procrit/Eprex. Sales in 2001 were $3.4 billion.

Other J&J drugs include Alzheimer's treatment Reminyl, and Levaquin and Floxin for bacterial infections, which all generated sales in excess of $1 billion in 2001, and Duragesic for chronic pain control.

Scios is forecast to generate sales of around $180 million this year, around half through Natrecor, with estimated sales last year of $90 million. Last year, Datamonitor estimated Scios would generate ethical revenues of around $340 million by 2006.

J&J posted global pharmaceutical sales of $17.2 billion last year, an increase of 15.5%.

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