Abbott Laboratories is making up with Alere after nearly a year of fighting, agreeing to buy the Massachusetts-based company for a lower price and ending its legal battles over the deal.
Abbott has agreed to buy Alere for $5.3 billion, down from the $5.8 billion agreed upon when the deal was announced in February 2016. Abbott will pay $51 per common share to acquire Alere.
“We believe this is an equitable settlement,” Abbott spokesman Scott Stoffel said in a statement. “Point of care is an attractive, growing segment with growth opportunities in both developed and emerging markets. Our core strategic intent — to build a leadership position in this segment — remains the same.”
Namal Nawana, CEO and president of Waltham, Massachusets-based Alere, said in a statement that the new terms of the deal “deliver value and certainty to Alere shareholders” and will speed Alere’s progress in making rapid diagnostics available globally. Alere sells tests used in doctors’ offices, hospitals, ambulances and homes.
Abbott filed a lawsuit in December seeking to escape the deal, saying Alere had “suffered a series of damaging business developments” including the government eliminating the billing privileges of an Alere division; the recall of a product platform; a five-month delay in filing its annual financial report; and government investigations, among other things.
Last year, Alere disclosed a U.S. investigation into its sale practices in Africa, Asia and Latin America, according to Alere. In August, the Justice Department also sent Alere a criminal subpoena over government billings and payments to doctors at Alere’s Austin, Texas, pain management laboratory.
Also in August, Alere sued Abbott in Delaware state court to force Abbott to “fulfill its obligations under the terms of the merger agreement” to gain all necessary regulatory approvals, according to an Alere statement.
Both companies are dropping their lawsuits as part of the new agreement.