Intra-Cellular Therapies Stock Up 34% on J&J's $14.6B Buyout Offer

Acquisition Details - Johnson & Johnson (JNJ) will acquire all outstanding shares of Intra-Cellular Therapies (ITCI) for $132 per share in cash, totaling approximately $14.6 billion [1] - The transaction is expected to be completed later this year, subject to customary closing conditions and regulatory approvals [3] ITCI's Marketed Drug and Pipeline - ITCI's sole marketed drug, Caplyta, is approved for schizophrenia and bipolar depression, with a regulatory filing submitted to the FDA for label expansion in major depressive disorder (MDD) [2] - ITCI is developing ITI-1284 for generalized anxiety disorder, Alzheimer's disease-related psychosis, and agitation, which will be added to J&J's pipeline post-acquisition [3] Stock Performance and Market Impact - Following the acquisition announcement, ITCI's stock rallied 34% on Monday, with a 92% increase over the past year compared to the industry's 16% decline [4] - Caplyta's sales grew 46% year-over-year to $481 million in the first nine months of 2024, with potential for further growth under J&J's commercial expertise [5] Strategic Fit for J&J - The acquisition aligns with J&J's neuroscience franchise, which includes drugs like Invega Sustenna and Spravato, and complements its late-stage investigational drug aticaprant for MDD [4] - A potential approval for Caplyta in the MDD indication could provide J&J with a blockbuster drug and be immediately accretive to its earnings [5] Financial Impact and Guidance - J&J plans to provide the financial impact of the transaction on its adjusted EPS during the Q4 earnings call on January 22, 2025 [6] Patent Litigation Victory - ITCI recently secured a patent litigation victory, protecting Caplyta from generic competition until at least July 1, 2040, under a settlement agreement with Sandoz [7]