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Sanofi, J&J could join GlaxoSmithKline, Reckitt in $20B bidding war for Pfizer OTC

October 27, 2017
Life sciences

GlaxoSmithKline and Reckitt Benckiser have already declared their interest in Pfizer’s consumer health unit. But they likely won’t be alone when bidding kicks off.

Companies including Sanofi, Johnson & Johnson and Procter & Gamble could also look to snag the unit, sources told Reuters, and Pfizer’s hoping competition can help it reap at least $20 billion from a sale.

The New York pharma giant plans to jump-start the auction process for the portfolio next month, they said, but Pfizer has already held talks with some suitors—including Reckitt. The company plans to send out financial info on its asset to wannabe buyers in about three weeks, and a deal could follow around the middle of next year, the news service reports.

Pfizer first announced that it was weighing options for the division—which generated $3.41 billion last year on the back of brands such Advil, ChapStick and Centrum—earlier this month, but analysts have speculated for some time that it could go on the block. Reckitt publicly expressed its enthusiasm nearly two years ago, when CEO Rakesh Kapoor told Bloomberg he’d be “very interested” in a buy.

Glaxo—which Reuters says has brought on Citi to represent it in the auction—made its own interest known on its Q3 earnings call Wednesday; new CEO Emma Walmsley told investors to “expect us to look at any assets that complement our portfolio”—including Pfizer’s.

J&J, for its part, has long been a leader in the consumer space, but it was eclipsed when GSK and Novartis joined hands to form an industry-leading JV back in 2015. Sanofi is a newer player, but it’s built up scale since first inking a $1.9 billion pact for Chattem in 2009. In November, 2015, CEO Olivier Brandicourt pledged to beef the unit up through bolt-on acquisitions. Food giant Nestlé’s name has also popped up on the list of potential buyers, thanks to its newfound ambitions in healthcare.

Meanwhile, there may be a consolation prize available to whichever companies lose out on Pfizer’s unit. Merck KGaA is also planning to divest its OTC offerings, though it may press pause on its own sale until it can come out from Pfizer’s shadow, Reuters notes.

By Carly Helfand

Source: Fierce Pharma

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