FILE PHOTO: The company logo for Johnson & Johnson is displayed on a screen to celebrate the 75th anniversary of the company’s listing at the New York Stock Exchange (NYSE) in New York, U.S., September 17, 2019. REUTERS/Brendan McDermid/File Photo

(Reuters) – Johnson & Johnson on Wednesday agreed to buy Momenta Pharmaceuticals Inc for about $6.5 billion to add muscle to its portfolio of drugs for hard-to-treat autoimmune diseases.

The deal gives J&J’s Janssen unit access to Momenta’s experimental therapy, nipocalimab, being tested for myasthenia gravis, a neuromuscular disease that causes weakness in muscles, and other diseases where the immune system attacks the body.

J&J hopes to get the drug approved to treat several conditions and eventually bring in blockbuster sales, as the company seeks to bulk up its largest business with a new class of medicines.

“Janssen will have the potential to introduce multiple launches, many as first-in-class indications with potential for significant peak year sales, some of which could exceed $1 billion,” Johnson & Johnson said in a statement.

Shares of Cambridge, Massachusetts-based Momenta were up 68.8% at $52, just a hair’s breadth away from the offer price of $52.50.

“We find the deal modestly surprising as we see every one of Momenta’s assets as somewhat tricky to develop,” said BTIG analyst Thomas Shrader, adding it was hard to imagine a higher bid for Momenta.

J&J’s offer for Momenta comes just days after France’s Sanofi struck a $3.7 billion deal to buy Principia Biopharma Inc for its pipeline of autoimmune disease treatments.

J&J in recent years has sold some divisions such as the one which makes medical devices for diabetes care as it sharpens focus on better-performing businesses like cancer treatments.

READ ALSO  'Waste Of Time': NPR Refuses To Cover Biden Scandal

The company, which is also one of the drugmakers racing to develop a vaccine for the coronavirus, recently signed deals with the United States and Britain for future doses of the potential vaccine.

Reporting by Manas Mishra in Bengaluru; Editing by Anil D’Silva and Sherry Jacob-Phillips

Via Reuters Finance