One of the biggest pieces of financial news came from the pharmaceutical sector. Earlier this year, Aimmune Therapeutics (NASDAQ:AIMT) made headlines when the biotech company won regulatory approval for its peanut-allergy drug candidate.
Considering that there are no other peanut allergy drugs out there on the market at all, it was a pretty big deal for the biotech stock. Now it seems that one of the largest food and beverage makers in the world, Nestlé, will be buying out Aimmune in a $2.6 billion acquisition.
Although Nestlé is known as a food and beverage manufacturer, Nestlé has been expanding considerably into the highly lucrative world of pharmaceuticals. While the company has dabbled in this area for a while, it’s exposure to the pharmaceutical world has ramped up significantly over the past few years.
A lot of this has to do with the company’s new CEO, Mark Schneider, who has been refocusing Nestlé’s business operations towards more profitable areas. This includes abandoning other business segments, such as skin care while putting more emphasis on other areas such as coffee and bottled water.
Among other things, pharmaceuticals and biotech is considered an especially promising area for Nestlé. The company has already held a part stake in Aimmune back in 2016 but has now decided to buy up the rest of the business for $2.6 billion. Nestlé went on to stay that it would pay $34.5 per share to buy out all the remaining stock of the company, which comes in at around a 175% premium to last week’s prices.
“The agreement with Nestlé Health Science recognizes the value created by years of commitment and dedication to our mission by the team at Aimmune. Delivering Palforzia, the world’s first treatment for food allergy, has been a game-changing proposition in the bio-pharmaceutical industry and is transformative for the lives of millions of people living with potentially life-threatening peanut allergy,” said Jayson Dallas, Aimmune’s CEO.
Aimmune’s only approved drug so far is Palforzia, which has been approved by the Food and Drug Administration (FDA) to help treat patients with peanut allergies. Considering just how common peanut allergies are around the world, it’s a potentially massive market for Aimmune. There’s also no other FDA approved peanut allergy drugs out there as well, so that’s another piece of good news for the biotech company.
This Aimmune deal would be Nestlé’s biggest foray into the pharmaceutical world so far in the company’s history. While it’s still uncertain how things will fare, the prospects for this peanut allergy drug look incredibly promising, to say the least.
Nestlé Company Profile
With a 150-year-plus history, Nestle is the largest food and beverage manufacturer in the world by sales, generating more than CHF 90 billion in annual revenue. Its diverse product portfolio includes brands such as Nestle, Nescafe, Perrier, Pure Life, and Purina. Nestle also owns just over 23% of French cosmetics firm L’Oreal. The company has a vast portfolio of global products, with 34 brands each achieving more than CHF 1 billion in sales annually and a geographic presence that spans 189 countries. – Warrior Trading News
