Valeant to acquire J&J's Ortho Dermatologics for $345 million

Acquisitive Canadian drugmaker Valeant Pharmaceuticals International (TSX: VRX) says it has signed an agreement to acquire the assets of the Ortho Dermatologics division of Janssen Pharmaceuticals, a subsidiary of US health care giant Johnson & Johnson (NYSE: JNJ).  Valeant’s shares, which were already up 86% from the start of this year, rose a further 4.6% to $55.02 in morning trading on Friday after the announcement.

Valeant will pay Janssen $345 million for the assets, which includes prescription brands Retin-A-Micro (tretinoin topical) for acne, Ertaczo (sertaconazole) for fungal infections and Renova (tretinoin) to help reduce skin wrinkles. Total revenue for the product portfolio was about $150 million in 2010. The transaction is subject to certain closing conditions and regulatory approvals and is expected to be accretive to earnings in 2011.

The deal was well received by investors, as Valeant’s shares, already up 94% this year, rose a further 4.5% to $55 at close of New York trading last Friday. J&J dipped 0.3% to $67.45.