Sanofi snubs Allergan, Allergan snubs Valeant

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Allergan has told Valeant to go packing. The LA Times reports that the Botox maker has told acquisition-minded Valeant that the $46 billion being offered undervalues the company. Allergan also said the deal includes significant shareholder risk.

“We question how long Valeant would achieve the level of cost cuts it is proposing without harming the long-term viability and growth trajectory of our business,” Allergan CEO David Pyott wrote in a letter to Valeant, the Times reported.

Monday's refusal follows reports by Bloomberg on Friday that both Sanofi and Johnson & Johnson told the Botox manufacturer they had no interest in buying up its business. Allergan's reported solicitation would be a way to short-circuit Valeant's takeover attempt.

Bloomberg notes that acquiring Allergan means taking on businesses that include neurologic, dermatological and urological products, which could mean new businesses acquirers don't already have. Bloomberg notes that this would mean these companies would be diversifying, which “runs counter to what many drug companies are doing."

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