ICN Pharmaceuticals Acquires 6.3% Stake in Hoffman-LaRoche

ICN Pharmaceuticals Inc. of Costa Mesa said Tuesday that it has purchased 6.3% of the stock of F. Hoffman-LaRoche & Co., a giant Swiss drug and chemical firm best known as the maker of the tranquilizers Valium and Librium.

Based on recent trading prices, the 1,020 LaRoche shares that ICN says it has purchased over the past year are worth about $210 million, or nearly as much as the $217-million market value of all of ICN’s own stock.

ICN, which reported earnings of $13 million on sales of $103 million in fiscal 1986, is tiny in comparison to LaRoche, which recorded profits of $280 million on sales of about $5 billion last year.

Although ICN officials would not comment on the reason for the stock purchases, a source close to the company said the link with LaRoche was hoped to give ICN a worldwide marketing network for its anti-viral drug, ribavirin.

Ribavirin is used to treat a fatal respiratory virus in babies, and ICN is attempting to win approval from the U.S. Food and Drug Administration for additional testing of ribavirin as a treatment for early-stage AIDS.

Milan Panic, ICN’s chairman, president and chief executive, did not rule out the possibility that ICN might purchase even more LaRoche stock. He said that, under Swiss law, a shareholder must own 10% of a company’s stock to be entitled to representation on the board of directors.

Max Gurtener, vice president of public relations at LaRoche headquarters in Basel, Switzerland, said in a telephone interview that company officials were taken by surprise when ICN informed them some weeks ago of its stock purchases.

LaRoche’s stock is not registered, so there is no record of purchases and sales.

ICN spokesman Jack Sholl declined to comment Tuesday “on the specifics of the transaction.”