Summary: Abbott Laboratories reported it is purchasing Kos Pharmaceuticals for 3.7 billion, or $78 a share, 56% higher than Kos's November 3rd closing price. Abbott acquires the most potent drug available for raising HDL, or good cholesterol . Bruce Cranna, an analyst with Leerink Swann & Co., commented: "It gains Abbott critical mass'' in the cholesterol drug market, which is a $20 billion a year industry. Kos' s medicine, called Niaspan, which uses the vitamin niacin to attack HDL cholesterol, is at the cutting-edge of heart drugs. On news of the acquisition Kos's shares rose 54% to $76.99 after a decline of 18% this past year, while Abbott's stock fell 15 cents to $47.49. Although Abbott's sales are expected to rise with the addition of Niaspan, many patients complain about facial flushing; the company is working on a new version of the Niaspan which will reduce this complaint, as well as Simcor, a generic form of Zocor, a top-selling cholesterol drug produced by competitor Merck.
Related links: Herb Greenberg's take on the merger: Kos Bought By Abbott Labs • The news answer's BioBlogger's question: Should Pfizer Acquire Kos Pharmaceuticals?
Potentially impacted stocks and ETFs: Abbott Laboratories (ABT), Kos Pharmaceuticals (KOSP) • Competitors: Merck (MRK), Pfizer (PFE), Sanofi-Aventis (SNY)
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