Johnson & Johnson, Synthes Reported in Merger Talks
From Philadelphia Inquirer (PA) (April 17, 2011)
April 16--Synthes Inc., a global medical-device manufacturer with headquarters in West Chester and manufacturing operations in the area, is reported to be in merger talks with Johnson & Johnson.
The Wall Street Journal reported Friday evening on its website that the deal, if completed, could be worth $20 billion, though the Journal cautioned that talks could break down.
"As a matter of policy, we don't comment on speculation," Johnson & Johnson spokesman Bill Price said in an e-mail.
Synthes officials could not be reached for comment Friday evening.
J&J stock closed in New York at $60.56, up 54 cents.
J&J is a multidimensional pharmaceutical company with medical-device branches, and has been trying to add to that part of its portfolio. Some pharmaceutical executives view devices as easier and quicker to manufacture and gain approval from the U.S. Food and Drug Administration.
Synthes was founded by four Swiss surgeons in 1958. Company chairman Hansjorg Wyss was 154th on Forbes' list of the world's billionaires at $6.4 billion, second-highest in Switzerland, where Synthes' stock is traded. Its Friday closing price was 138.7 Swiss francs -- $155.44.
Synthes makes compounds, devices, and tools to treat several kinds of bone problems.
Synthes' website says it had 11,423 employees in 2010, with 42 percent in North America. It has five facilities in West Chester and one in Paoli.
As another example of the company's local footprint, the Synthes Spine division employed 1,332 people within the West Chester School District, according to bond documents.
In November, a Synthes subsidiary, Norian Corp., and four executives pleaded guilty to charges that they had trained and encouraged doctors to use a Synthes bone cement for use in ways not approved by the FDA.
Three patients died on operating tables, according to court filings by the U.S. Attorney's Office in Philadelphia, which helped prosecute the case.
Synthes agreed to pay fines of $23.2 million and divest itself of Norian.
The four executives who pleaded guilty to criminal charges were former Synthes North American president Michael D. Huggins of West Chester; former senior vice president Thomas B. Higgins of Berwyn; vice president Richard E. Bohner of Malvern; and director of regulatory and clinical affairs John J. Walsh of Coatesville.
Sentencing of the four has not been scheduled.
Contact staff writer David Sell at 215-854-4506 or email@example.com.
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Posted: April 2011