Shares of Palo Alto-based Alza Corp. fell 2.5% amid concern about the status of its plans to be acquired by Abbott Laboratories Inc., a transaction that was approved by shareholders last month.
Abbott in June offered to pay 1.2 of its shares for every share in Alza, a developer of sustained-release drugs. The agreement then was worth $7.3 billion. Its value has since declined to about $6.3 billion as Abbott shares have declined because of regulatory problems with the U.S. Food and Drug Administration.
The difference between what Abbott offered to pay and the price of Alza shares widened again today amid concerns that the deal could fall through, analysts said. Alza shares fell $1.13 to $44.25. Abbott shares have fallen 12% since the transaction was announced. Today they fell 13 cents to $38.81.
"It's impossible for any deal to go through with the FDA matters unresolved," said Alex Zisson, an analyst with Hambrecht & Quist Group, who has a "buy" on Abbott.
Abbott's troubles included a dispute with the FDA over manufacturing problems, which Abbott said could result in the FDA halting the manufacture and sale of some of its products. That problem was disclosed Sept. 28, seven days after Alza shareholders approved the sale to Abbott.
Abbott spokeswoman Rhonda Luniak said her company still expects the agreement to close by the end of the year.