Women’s health company Organon (OGN), which was spun-off from Merck (MRK), has completed the acquisition of commercial-stage medical device company Alydia Health.
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The total consideration for the acquisition was $240 million, which included $215 million in cash and a contingent milestone payment of $25 million.
Alydia focuses on postpartum hemorrhage (PPH), one of the most common complications during birth. About 10% of mothers require pharmacologic treatment due to PPH.
Organon CEO Kevin Ali said, “Organon’s acquisition of Alydia Health expands our portfolio into the medical device category and underscores our commitment to identify options for women’s unmet medical needs.” (See Organon Capital stock chart on TipRanks)
Ali added, “This acquisition brings us one step closer to our vision of a better and healthier every day for every woman around the world.”
Alydia’s medical device, the Jada System, is specifically designed to encourage normal contraction of the uterus to stop excessive bleeding after childbirth. It received marketing authorization from the FDA in August 2020.
On June 15, J.P. Morgan analyst Chris Schott initiated coverage on the stock with a Hold rating and a price target of $38 (23.8% upside potential).
Schott believes Organon is highly diversified but offers lower growth potential, and its growth initiatives will take time to bear fruit.
Based on 1 Buy and 2 Holds, consensus among analysts is a Moderate Buy. The OGN average analyst price target of $35.50 implies 15.6% upside potential.
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