Sector News

Mylan Says It Is Opposed To Possible Teva Pharmaceuticals Merger

April 20, 2015
Life sciences
Generic drugmaker Mylan wants to put speculation of a possible merger with Teva Pharmaceuticals to rest. A potential deal, the company said, is “without sound industrial logic” and would have a hard time winning anti-trust clearances.
 
Mylan’s comments on Friday responded to reports from both Bloomberg and the Wall Street Journal that indicated Teva Pharmaceutical is considering a bid for the company. Speculation of a Teva bid pushed Mylan shares higher by over 4% on Friday, closing trading at a $32 billion market capitalization. Teva shares rose more than 2%.
 
“We have studied the potential combination of Mylan and Teva for some time and we believe it is clear that such a combination is without sound industrial logic or cultural fit,” Mylan executive chairman Robert Coury said in a statement.
 
“Further, there would be significant overlap in the companies’ businesses and we believe that it is unlikely that any such combination could obtain anti-trust regulatory clearances,” he added.
 
The company said on Friday it remains committed to a stand-alone business strategy, which includes a $28.9 billion unsolicited offer for competitor Perrigo , announced on April 8. “Today’s speculation has no impact whatsoever on this strategy,” said Koury, who added that the if a bid is made, the company will consider it in and what is in the best interest of its stakeholders,
 
Earlier in April, Mylan said it would pay $205 a share in cash and stock for Perrigo, without specifying an exact formula for its unsolicited takeover offer. With Perrigo in hand, Mylan said it would reach a critical mass in specialty brands, generics, over-the-counter (OTC) and nutritional products.
 
Mylan’s offer for Perrigo and signs Teva may enter the M&A fray, come at a time of heavy dealmaking in the fast-consolidating pharmaceutical sector.
 
In 2015 alone, Pfizer, Valeant Pharmaceuticals, Shire  and AbbVie have all cut multi-billion dollar takeover deals, leading to $126 billion in M&A in the first quarter, according to data provider Dealogic.
 
That comes on the heels of a banner year for healthcare M&A, even as a Department of Treasury freeze on so-called inversion transactions cancelled some of the year’s biggest merger efforts.
 
By Antoine Gara
 
Source: Forbes

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