Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

Source: Achillion Pharmaceuticals

What: Shares in Achillion Pharmaceuticals (NASDAQ:ACHN) slid by more than 10% earlier today after the company announced that it had licensed drugs in its hepatitis C pipeline to Johnson & Johnson (NYSE:JNJ).

So What: The move is dissapointing to investors who were hoping that Achillion Pharmaceuticals would find a suitor that would buy it lock-stock-and-barrel. Instead, Johnson & Johnson has agreed to a deal that includes milestone payments and an equity investment.

Specifically, Johnson & Johnson will pay Achillion Pharmaceuticals up to $1.1 billion in development and commercial milestones if Achillion Pharmaceuticals' drugs pan out.

Johnson & Johnson has also agreed to take over development of Achillion Pharmaceuticals' hepatitis C program and to pay Achillion Pharmaceuticals royalties on any eventual sales that are based on a sliding scale that starts in the mid-teens and climbs into the low-twenties.

Additionally, rather than buying Achillion Pharmaceuticals outright, Johnson & Johnson will invest $224 million in Achillion Pharmaceuticals through the purchase of 18.4 million newly issued shares at a price per share of $12.25.

Source: Johnson & Johnson

Now What: Johnson & Johnson has been at the forefront of developing hepatitis C therapies, and it appears that it remains focused on developing the next generation of shorter duration treatments.

Last October, it acquired the privately-held Alios to get its hands on Alios' nucleotide inhibitors, which work similarly to Gilead Sciences(NASDAQ:GILD) top-selling HCV drug Sovaldi, and this recent deal adds Achillion's ACH-3102, an NS5A inhibitor that could prove to be as effective as Gilead Sciences' ledipasvir, which is used alongside Sovaldi in Gilead Sciences' blockbuster HCV drug Harvoni.

Overall, Achillion Pharmaceuticals' investors' disappointment surrounding this deal might prove to be misplaced. The well-heeled Johnson & Johnson could offer Achillion Pharmaceuticals the best chance at development and commercial success, and if so, that could end up meaning that Achillion Pharmaceuticals ends up being worth more than its current $1 billion market cap.