A Bloody Good Deal for Johnson & Johnson

It was a steal. Maybe not on par with the accomplishments of Ty Cobb or the exploits of John Dillinger, but a steal nonetheless.

Johnson & Johnson (NYSE: JNJ) picked up Omrix Biopharmaceuticals (Nasdaq: OMRI) for a song today. The company is purchasing its partner for $438 million dollars. That works out to $25 per share -- an 18% premium over where it closed on Friday, but well below where it was a year ago.

The health-care giant already sells Omrix's two products designed to stop bleeding during surgery. Evicel, its fibrin sealant, has been selling well, while Evithrom has run into competition in the battle of the thrombins from King Pharmaceuticals (NYSE: KG) and, to a lesser extent, newcomer ZymoGenetics. Johnson & Johnson will also gain full control over a fibrin patch -- a combination physical barrier and biologic -- which is in phase 2 trials right now.

After subtracting the roughly $80 million in cash and investments that Omrix has, Johnson & Johnson is getting those assets for a little less than $360 million. For a company that logged $79 million in revenue in the trailing 12 months -- a 33% increase over the previous year -- that sounds like a pretty good bargain to me. It's slightly below where Omrix was when Motley Fool Rule Breakers analyst Karl Thiel recommended it to newsletter subscribers a couple of years ago.

Which company could be snatched up next? Your guess is as good as mine, but there are certainly several candidates to choose from. King announced today that it is buying Alpharma (NYSE: ALO), but I'd hardly call that a steal, as the acquisition price was well above where Alpharma traded before King made its original bid public last summer. Amylin Pharmaceuticals (Nasdaq: AMLN) seems ripe for the picking, but the most obvious acquirer, Amylin's partner Eli Lilly (NYSE: LLY), is a little busy at the moment wrapping up its acquisition of ImClone Systems (Nasdaq: IMCL).

Johnson & Johnson's purchase of Omrix may have been one of the first steals of the health-care bear market, but I doubt it'll be the last. Pharmaceutical companies (and investors) with cash on their books should be able to find plenty of deals in this market.