June 25 (UPI) -- Biopharmaceutical giant AbbVie Inc. announced Tuesday that it was purchasing Botox-maker Allergan in cash and stock transfers valued at about $63 billion.
The purchase of Ireland-based Allergan gives AbbVie, headquartered in suburban Chicago, a new revenue stream in the popular market of beauty drugs while seeing an end to patent protection for its leading rheumatoid arthritis drug Humira, the Wall Street Journal noted. Allergan makes almost $16 billion in revenue annually.
"This is a transformational transaction for both companies and achieves unique and complementary strategic objectives," Richard A. Gonzalez, AbbVie's chairman and chief executive officer said in a statement.
"The combination of AbbVie and Allergan increases our ability to continue to deliver on our mission to patients and shareholders," he added.
Allergan said the move will allow it to make advanced contributions in the global health field and enhance both companies.
"Our fast-growing therapeutic areas, including our world-class medical aesthetics, care, CNS and gastrointestinal businesses, will enhance AbbVie's strong growth platform and create substantial value for shareholders of both companies," Brent Saunders, chairman and chief executive officer of Allergan, said in a statement.
Humira made up $19.1 billion of AbbVie's $32.8 billion in revenue last year, but lower-cost versions of the drug are expected to be sold in American by 2023.
In the deal, Allergan shareholders will receive 0.8660 ofAbbVie shares and $120.30 in cash for each Allergan share, for a total of$188.24. Allergan shares rose 31 percent in premarket trading Tuesday to $170.25 per share while AbbVie dropped eight percent to $72.