• by Bruce Carlson
  • May 2 2017
  • IVD

Back On: Abbott to Acquire Alere, Creating Clear #2 in IVD Industry

Back On: Abbott to Acquire Alere, Creating Clear #2 in IVD Industry

News in the IVD market that surprised many.  In April 2017, Abbott and Alere announced that they had agreed to amend the terms under which Abbott’s will acquire Alere. With this announcement, the two companies appear to finally be moving towards completion of this acquisition, after a long, contentious period. Abbott has agreed to pay $51 per common share, which gives an expected equity value of approximately $5.3 billion for Alere. In February 2016, Abbott and Alere had announced a definitive agreement for Abbott to acquire Alere for $56 per common share, giving an expected equity value of $5.8 billion. Abbott would become the leading provider of point-of-care testing, and that would have total diagnostics sales of more than $7 billion.

 In October 2016, Alere announced that its shareholders had approved the merger.   However, following the February 2016 announcement of the acquisition agreement, Alere experienced several major setbacks. In addition, Alere filed its Form 10-K for 2015 late and has not yet filed its Form 10-K for 2016. In March 2017, Alere received a notice from the New York Stock Exchange (the "NYSE") that the Company is not in compliance with the NYSE's continued listing requirements under the timely filing criteria. In August 2016, Alere filed a complaint against Abbott, seeking to compel Abbott to fulfill its obligations under the terms of the merger agreement. InDecember, Abbott announced that it had filed a complaint to terminate its proposed acquisition of Alere based on the substantial loss in Alere's value following the merger agreement. Alere issued a statement in response to the lawsuit filed by Abbott, stating (among other things) that the lawsuit was entirely without merit, and that Alere would take all actions necessary to protect its shareholders and to compel Abbott to complete the transaction in accordance with its terms. In January 2017, Alere announced that the European Commission had granted clearance for Abbott to acquire Alere.

With the April 2017 announcement that the companies had agreed to amend the terms of the acquisition, Abbott and Alere are again moving forward with the acquisition. The press release reported that the transaction is expected to close by the end of the third quarter of 2017, subject to the approval of Alere shareholders and the satisfaction of customary closing conditions, including applicable regulatory approvals. Abbott and Alere also agreed to dismiss their respective lawsuits.

While well short of IVD leader Roche, the renewed merger creates space between Abbott and it's two rivals Danaher and Siemens Healthineers for second-place in the IVD market. 

Kalorama covers the IVD Market in total including sales, test volumes and pricing data in its report: Worldwide Market for In Vitro Diagnostics 2017: IVD Test Volumes and Pricing Analysis.

Kalorama Information Worldwide Market for In Vitro Diagnostics 2017: IVD Test Volumes and Pricing Analysis has projected test volumes, including share of volumes for both Abbott and Alere. The report can be found at: https://www.kaloramainformation.com/Worldwide-IVD-Procedure-10743219/