J&J to acquire Intra-Cellular Therapies in US $14.6 billion deal

USA – Johnson & Johnson (J&J) has agreed to acquire Intra-Cellular Therapies for up to US $14.6 billion in a deal valued at US $132 per share.

This move follows Intra-Cellular’s promising phase 3 results for its leading product, Caplyta (lumateperone), which has the potential to significantly expand its market.

Intra-Cellular’s stock surged by over a third, surpassing US $128 per share after the announcement.

Caplyta, which is already approved by the FDA for treating schizophrenia and bipolar depression, has also shown effectiveness in treating major depressive disorder (MDD.

RBC Capital Markets analysts predict that MDD sales could exceed US $3 billion annually. In comparison, Intra-Cellular anticipates Caplyta will generate between US $665 million and US $685 million in sales in 2024.

J&J, already active in the market for drugs addressing resistant MDD with Spravato (esketamine) and the phase 3 drug seltorexant for insomnia linked to depression, sees the acquisition as a strategic move to further enhance its portfolio.

J&J CEO Joaquin Duato described the deal as a key growth catalyst for both the company and its shareholders, offering significant value to patients and healthcare systems.

Intra-Cellular has also filed for approval of Caplyta as an add-on treatment for standard antidepressants.

This filing is based on positive results from two phase 3 trials (Study 501 and 502), which demonstrated that a once-daily dose of Caplyta significantly improved depression scores in patients who did not respond adequately to standard treatments alone.

The merger is the second major M&A deal announced during this year’s JP Morgan Healthcare Conference.

J&J’s announcement came just hours after GSK confirmed it had agreed a US $1 billion deal to buy cancer biotech IDRx and its KIT inhibitor for gastrointestinal stromal tumours (GIST).

If finalized, the Intra-Cellular acquisition would become the largest pharma-biotech deal since Pfizer’s US $43 billion purchase of Seagen in late 2023.

Caplyta is a first-in-class drug acting on dopamine, serotonin, and glutamate neurotransmitter systems.

It has a faster onset of action compared to traditional antidepressants, which typically take weeks to improve mood.

It competes with AbbVie’s Vraylar (cariprazine) and Axsome’s Auvelity (dextromethorphan/bupropion), both of which are used to treat MDD in addition to schizophrenia and bipolar disorder.

The acquisition also includes ITI-1284, a deuterated form of lumateperone, currently being studied for generalized anxiety disorder (GAD) and Alzheimer’s-related psychosis and agitation.

The deal comes on the heels of Intra-Cellular’s settlement with Sandoz over patent litigation related to Caplyta, granting Sandoz rights to generic versions in the U.S. after July 2040.