Sector News

Turnaround-minded Teva CEO scouts deals in specialty generics, emerging markets

December 15, 2014
Life sciences
With a bounce-back in share price, Teva’s in a position to do something it hasn’t done much over the past few years: buy companies. And when it comes to getting back into the M&A game, CEO Erez Vigodman has a few types of targets at the top of his list.
 
On a quest to return to growth after a tumultuous 2013, Teva has its eye on complex generics manufacturers and emerging markets generics gurus, according to local newspaper Haaretz. Pickups in those fields should help Teva return to–and strengthen–its generic roots, a goal Vigodman has stressed during his first year in the helmsman’s seat.
 
And there’s room to do it. Take complex generics, for instance. High barriers to entry keep competition scarce–and, in some markets, it’s non-existent, Haaretz notes. Teva could move into specialty areas such as quick-dissolving thin films, patches and injectables, to name a few.
 
In some developing countries, Teva will need buyouts to get it up to speed. As the company’s global generics CEO, Sigurdur Olafsson, told Haaretz, it’s No. 81 in Brazil–an inappropriate position for a drugmaker of Teva’s size. The Petah Tikva-based pharma will be working to beef up its footprint in Mexico too, he said.
 
But that doesn’t mean Teva’s focusing exclusively on bolstering its generics business. Vigodman said he’s scouting for American companies that develop original drugs, which could help ease the branded sales decline nearing with the end of lead drug Copaxone’s patent life.
 
Teva has a share price revival to thank for putting it in a position to make some deals, Haaretz points out. Since Vigodman took up the reins early this year, the company’s stock has soared to $57 per share–a 40% increase–which gives it more firepower for equity-based buyouts.
 
But to preserve those gains, the company needs to keep the markets believing that profits lie beyond the Copaxone patent cliff. To that end, last Thursday the company said 2015 earnings would hit $5 to $5.30 per share, depending on when copycat challengers from teams of Mylan and India’s Natco Pharma and Novartis’ Sandoz and Momenta Pharmaceuticals hit the market.
 
By Carly Helfand
 

comments closed

Related News

January 22, 2023

Sun Pharma to buy Concert Pharmaceuticals for $576m

Life sciences

Sun Pharmaceutical Industries has signed a definitive agreement to buy all outstanding shares of Concert Pharmaceuticals in a deal valued at $576m. Under the deal, the company will buy all shares of Concert common stock through a tender offer for $8.00 per share in cash upfront payment.

January 22, 2023

Novo Nordisk diabetes pill wins FDA approval for first-line use

Life sciences

The Food and Drug Administration on Thursday approved Novo Nordisk’s diabetes pill Rybelsus as an initial treatment to lower blood sugar levels, a label expansion that will allow it to compete more directly with other oral drugs from Merck & Co. and Eli Lilly.

January 22, 2023

Bayer feeling more heat from activist investors, this time from Bluebell

Life sciences

Since making an ill-advised $63 billion buy of Monsanto in 2018, Bayer has faced heaps of pressure from investors that have called for the company to oust its leadership and to restructure. Now comes new pressure from a familiar source. Bluebell Capital Partners has bought an undisclosed stake in the company and is agitating for a breakup, sources told Reuters.

How can we help you?

We're easy to reach