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Amgen to buy psoriasis drug for $13.4B; J&J braces for opioid suit verdict

Top news

* Amgen Inc. said it was buying the global rights to psoriasis medicine Otezla for $13.4 billion in cash from Celgene Corp. The drug, which generated $1.6 billion in revenues, is expected to have at least low double-digit sales growth, on average, over the next five years, according to Amgen. The sale will help Bristol-Myers Squibb Co. with regulatory approval for the $95 billion acquisition of Celgene which had U.S. regulators concerned.

* An Oklahoma judge is expected to make a ruling today in an opioid lawsuit brought by the state against Johnson & Johnson, CNN reported. The state has accused the pharmaceutical giant of creating a public nuisance that cost the state billions of dollars, said the report. Pharmaceutical companies like Johnson & Johnson, Allergan PLC, Teva Pharmaceutical Industries Ltd., Endo International PLC and Mallinckrodt PLC face litigation in the U.S. for allegedly engaging in marketing practices that contributed to the ongoing opioid crisis — an epidemic that kills about 200 Americans each day.

* Merck & Co. Inc., Johnson & Johnson, Bayer AG, Boehringer Ingelheim GmbH, and France's Servier Inc. filed a suit challenging the constitutionality of a new Canadian law that has been brought to lower patented drug prices, Reuters reported.

* The Democratic Republic of Congo has vaccinated more than 200,000 people against Ebola in August using Merck & Co. Inc.'s vaccine, Reuters reported. The epidemic is the second largest on record and has been declared a public health emergency of international concern as well as a national security concern for the U.S.

On the policy front

* If President Donald Trump ever carries out his order for U.S. companies to exit China, it could cripple the biopharmaceutical industry, which relies heavily on that nation for key ingredients for American drug products. According to the U.S. Food and Drug Administration, about 80% of the active pharmaceutical ingredients used in the drugs Americans take comes from overseas — mostly from China.

* A new immigration rule from the Trump administration that will include Medicaid enrollment as a determining factor for allowing individuals to legally enter the U.S. or change their residency status could lead to a significant drop in Medicaid enrollment, according to healthcare experts.

* Chinese lawmakers voted to adopt a revised drug administration law on Aug. 26, according to the National People's Congress. The amended law aims to encourage the development of drugs for children, and build a unified system to track drug information.

M&A and capital markets

* Shanghai Henlius Biotech Co. Ltd., a unit of Shanghai Fosun Pharmaceutical (Group) Co. Ltd., is estimating investor demand as it mulls a Hong Kong IPO. The potential IPO could fetch at least $600 million, Bloomberg News reported citing people familiar with the matter.

Drug and product pipeline

* Eli Lilly and Co. and Incyte Corp.'s medicine Olumiant helped reduce the symptoms of eczema in certain patients. The companies evaluated two dosing regimens of Olumiant against placebo in a phase 3 trial dubbed Breeze-AD7 in patients with moderate to severe eczema — a condition that makes the skin red and itchy, with rashes flaring periodically.

* The European Medicines Agency sent a letter to healthcare providers and patients informing them of new measures to avoid serious and potentially fatal errors with the dosing of methotrexate, including limiting its use as a treatment for inflammatory diseases. Methotrexate is a chemotherapy agent and immune suppressant which is approved in the EU to treat cancer and inflammatory diseases such as rheumatoid arthritis, psoriasis and Crohn's disease.

Operational activity

* Gilead Sciences Inc. and Galapagos NV closed their research and development collaboration, valued at over $5 billion, after receiving antitrust clearance from the U.S. Federal Trade Commission and merger control approval from the Austrian Federal Competition Authority.

* Indian drugmaker Glenmark Pharmaceuticals Ltd. is recalling over 31,000 tubes of anti-fungal cream Clotrimazole and Betamethasone Dipropionate from the U.S. market due to complaints related to liquidity texture, The Economic Times (India) reported.

The day ahead

Early morning futures indicators pointed to a higher opening for the U.S. market.

In Asia, the Hang Seng fell 1.91% to 25,680.33, and the Nikkei 225 dropped 2.17% to 20,261.04.

In Europe, around midday, the Euronext 100 was up 0.32% to 1,038.53.

Click here to read about today's financial markets, setting out the factors driving stocks, bonds and currencies around the world ahead of the New York open.

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