SCHEDULE 14A INFORMATION
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Scios Inc.
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Johnson & Johnson
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Filed by Johnson & Johnson
Pursuant to Rule 14a-12
of the Securities Exchange Act of 1934
Subject Company: Scios Inc.
Commission File No.: 0-11749
The following is the text of a joint press release issued by Scios Inc.
and Johnson & Johnson on February 10, 2003:
Johnson & Johnson
Press Contacts: Jeffrey Leebaw Marc Monseau
(732) 524-3350 (732) 524-1130
Home (732) 821-6007 (609) 924-7207
Johnson & Johnson
Investor Contacts: Helen E. Short Stan Panasewicz Lesley Fishman
(732) 524-6491 (732) 524-2524 (732) 524-3922
Scios Inc.
Press Contact: Suzanne Beveridge Investor Relations: Suzanne Beveridge
(408) 616-2947 (408) 616-2947
Jim Weiss
(415) 260-1274
FOR IMMEDIATE RELEASE
Johnson & Johnson to Acquire Scios Inc.
Cash for Stock Transaction Valued at $2.4 Billion
New Brunswick, NJ and Sunnyvale, CA -- (February 10, 2003) - Johnson &
Johnson (NYSE: JNJ), the world's most comprehensive and broadly based
manufacturer of health care products, and Scios Inc. (NASDAQ:SCIO), a
biopharmaceutical company with a marketed product for cardiovascular disease
and research projects focused on auto-immune diseases, today announced they
have signed a definitive agreement under which Johnson & Johnson will acquire
Scios in a cash for stock exchange.
Under the terms of the agreement, Scios shareholders will receive $45.00
for each outstanding Scios share. The value of the transaction as of the
anticipated closing date is expected to be approximately $2.4 billion, net of
cash, based on Scios' approximately 59.8 million fully diluted shares
outstanding.
The boards of directors of Johnson & Johnson and Scios have given their
approval to the transaction, which is subject to clearance under the
Hart-Scott-Rodino Anti-Trust Improvements Act. This transaction is also
subject to the approval of the shareholders of Scios and other customary
closing conditions.
Scios is a biopharmaceutical company developing novel treatments for
cardiovascular and inflammatory disease. The Company's disease-based
technology platform integrates expertise in protein biology with computational
and medicinal chemistry to identify novel targets and rationally design small
molecule compounds for large markets with unmet medical needs. Scios' product
NATRECOR(R)is the first novel agent approved for congestive heart failure
(CHF) in more than a decade. NATRECOR(R) is a recombinant form of a naturally
occurring protein secreted by the heart as part of the body's response to CHF.
The drug has several significant advantages over existing therapies for CHF,
the single most common cause of hospitalization in the United States for
patients over 65.
The principal focus of Scios' research and development program is small
molecule inhibitors, and includes several potential new treatments for pain
and inflammatory diseases, including an advanced p-38 kinase inhibitor
program.
"Scios strengthens our growing cardiovascular franchise and broadens our
pipeline with several potential new chemical entities," said Christine Poon,
Worldwide Chairman, Pharmaceuticals Group, Johnson & Johnson. "NATRECOR(R) is
a truly unique product for a largely underserved and growing market. Scios
also brings an advanced research program on kinase inhibitors, which is an
exciting new area of research."
Richard B. Brewer, President and Chief Executive Officer of Scios, said:
"This is an important strategic transaction for Scios, further strengthening
our organization's financial and operational capabilities for the long-term
and achieving for our shareholders an immediate premium cash return on their
investment. Becoming part of Johnson & Johnson is ideal for Scios both
culturally and scientifically. We share common values and vision. Johnson &
Johnson's financial and management resources will enable us to realize the
full potential of NATRECOR(R) and to bring significant new products to
market."
-more-
The transaction is expected to close in the second quarter of 2003. This
transaction is expected to have a $.05 dilutive impact in 2003 and 2004. In
addition, an estimated one-time charge of approximately $700 million for
in-process research and development will have an EPS impact (earnings per
share) of $.23.
In January, Bob Darretta, Chief Financial Officer of Johnson & Johnson,
provided guidance that he endorsed the 2003 First Call Consensus estimate of
$2.62. Mr. Darretta has indicated that the Company expects to fund the
dilution associated with this transaction and recommends that 2003 full year
EPS estimates remain the same (excluding one-time charges).
Johnson & Johnson, with approximately 108,300 employees, is the world's
most comprehensive and broadly based manufacturer of health care products, as
well as a provider of related services, for the consumer, pharmaceutical, and
medical device and diagnostic markets. Johnson & Johnson has 198 operating
companies in 54 countries around the world, selling products in more than 175
countries.
Note to Investors
Johnson & Johnson and Scios will conduct a conference call with financial
analysts to discuss this news release today at 9:15 AM, Eastern Standard Time.
A simultaneous webcast of the conference call for interested investors and
others may be accessed by visiting the Website homepage of Johnson & Johnson
or Scios and clicking on the webcast icon or by clicking on Calendar of Events
in the Investor Relations section of the Web site. A replay will be available
approximately two hours after the live webcast and can be accessed by clicking
on "Webcast Archives" in the Investor Relations section.
Scios Forward-Looking Statement
This news release contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. We generally identify such forward-looking statements
using words like "estimate," "believe," "intend," "expect," "may," "should,"
"plan," "project," "contemplate," "anticipate" or similar statements.
Statements that are not historical facts are forward-looking statements based
on current assumptions that involve risks and uncertainties. These risks and
uncertainties may include the sales penetration and success of Natrecor, the
success of clinical trials of Natrecor and our pipeline products, including
SCIO-469 and inhibitors to TGF-beta, our ability to partner the development
and commercialization of our pipeline products and Natrecor (outside the U.S.
and Europe) with third parties on favorable terms, or at all, as well as other
risks detailed from time to time in the reports filed by Scios with the SEC,
including the Company's quarterly reports and annual report on Form 10-K.
Actual results, performance or achievements of Scios may differ significantly
from those described in these forward-looking statements. Scios disclaims any
intention or obligation to update or revise any financial projections or
forward-looking statements, whether as a result of new information, future
events or otherwise.
Johnson & Johnson Forward-Looking Statement:
This press release contains "forward-looking statements" as defined in the
Private Securities Litigation Reform Act of 1995. These statements are based
on current expectations of future events. If underlying assumptions prove
inaccurate or unknown risks or uncertainties materialize, actual results could
vary materially from the Company's expectations and projections. Risks and
uncertainties include general industry conditions and competition; economic
conditions, such as interest rate and currency exchange rate fluctuations;
technological advances and patents attained by competitors; challenges
inherent in new product development, including obtaining regulatory approvals;
domestic and foreign health care reforms and governmental laws and
regulations; and trends toward health care cost containment. A further list
and description of these risks, uncertainties and other factors can be found
in Exhibit 99(b) of the Company's Annual Report on Form 10-K for the fiscal
year ended December 30, 2001. Copies of this Form 10-K are available online at
www.sec.gov or on request from the Company. The Company assumes no obligation
to update any forward-looking statements as a result of new information or
future events or developments.
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