Abbott will proceed with its planned acquisition of Alere, but at a lower price, the companies said today, after resolving a year-long legal wrangle stemming from a decline in Alere’s value followed by Abbott’s attempt to end the deal.

The companies amended the terms of their original agreement, with Abbott now paying $51 per common share to acquire Alere, valuing the acquisition at $5.3 billion—$500 million less than planned when the companies announced their $56-per-share deal on February 1, 2016.

At the time, Abbott chairman and CEO Miles D. White hailed the acquisition as one that would “create the world’s premier point-of-care testing business and significantly strengthen and grow Abbott’s diagnostics presence.” The deal would create for Abbott a broad point-of-care menu of infectious disease, molecular, cardiometabolic, and toxicology testing, as well as expand Abbott’s platforms to include benchtop and rapid strip tests.

The companies’ amended acquisition agreement extends by 5 months the date by which regulatory approvals must be received, from April 30 to September 30. Abbott said last year its total annual diagnostics sales would exceed $7 billion once the deal closes.

Abbott and Alere also agreed to dismiss the lawsuits each filed against the other since initially coming to terms. In December, Abbott sued Alere seeking to end the proposed acquisition, citing a “substantial” 42% loss in Alere’s value since the merger was first announced.

That decline followed a series of setbacks for Alere that included multiple government subpoenas.

In March 2016, Alere received a Justice Department grand jury subpoena related to “sales, sales practices, and dealings with third-parties (including distributors and foreign governmental officials) in Africa, Asia, and Latin America.” Four months later in July 2016, Alere said its Alere Toxicology Services unit was subpoenaed for records related to Medicare, Medicaid, and Tricare billings dating back to 2010 for patient samples tested at the company’s Austin, TX, pain management lab.

Other setbacks for Alere included a decision by the Centers for Medicare & Medicaid Services (CMS) to revoke the billing privileges of Alere’s Arriva Medical division; the permanent recall of a product platform, the INRatio® and INRatio2® PT/INR Monitoring System; and Alere’s 5-month delay in filing its 10K annual report, coupled with restatement of its 2013–2015 financials.

Previously, Alere and Abbott exchanged lawsuits against each other. Alere’s filing in August 2016 sought to close the acquisition by forcing Abbott to pursue clearance in accordance with federal antitrust law. Abbott responded with its own suit,

The deal is expected to close by the end of the third quarter, subject to the approval of Alere shareholders and the satisfaction of customary closing conditions, including applicable regulatory approvals.

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