Two $1 billion dollar acquisition deals go through
pharmafile | August 11, 2010 | News story | Sales and Marketing | Alcon, M&A, MA, Novartis, Ratiopharm, Teva
Two major acquisition deals mounted by Teva and Novartis are in their final stages as they move to complete potentially lucrative deals with other companies.
In January Novartis offered $38.5 billion to acquire global eye care leader Alcon with a view to folding the company into a new Novartis eye care division.
The European Commission has just approved the proposed acquisition – so long as Novartis gets rid of several ophthalmological pharma and consumer vision care products it has in some member states.
The EC’s competition concerns came about because Novartis and Alcon both have similar brands, including anti-allergics, decongestants, non-steroidal anti-inflammatories, injectable miotics, and anti-glaucoma products.
But in view of Novartis’ divestment commitments, and subject to a market test, the Commission has concluded the merger would no longer raise competition concerns.
Meanwhile, Teva has completed its tie-up with German generics firm Ratiopharm in a deal that will make it the number one generics maker in Europe.
“Increasing Teva’s market share in Europe – a geography with tremendous potential for generics penetration – is an important pillar of our long-term growth strategy,” said Teva president Shlomo Yanai.
The Tel Aviv-based firm has paid 3.6 billion euros for Ratiopharm shares and Teva’s European sales will increase from $3.3 billion last year to joint pro forma sales of $5.2 billion. It could also double its sales in Canada.
Although the combined entity will initially comprise 40,000 staff worldwide – 18,000 of whom are in Europe – the company has made clear that it expects cost savings from the arrangement of at least $400 million within three years.
Ratiopharm has 500 molecules covering all major therapeutic areas that it markets in 26 countries, along with expertise in biosimilars. Last year it reported worldwide revenues of 1.6 billion euros – but mounting debts at parent company Merckle made its sale a necessity.
It has been an attractive target for the pharma industry, with Pfizer reportedly bidding $4 billion for the firm earlier this year and another major generics firm, Actavis, also in the running.
However, Ratiopharm chief executive Oliver Windholz said: “We have long viewed Teva as the right match for our company, thanks to its clearly defined strategic vision and commitment to generic medicines and its highly reputable management.”
Adam Hill
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