Actavis in talks to buy Forest Laboratories for around $25 bn
18 February 2014
Actavis Plc is in advanced talks to buy Forest Laboratories Inc in a deal that could value the US drug maker at up to $25 billion, The Wall Street Journal today reported citing people familiar with the matter.
Actavis hopes the Forest acquisition would enable it to deal with the changing health-care scenario in in the US where hospitals, insurers and doctors are joining hands to negotiate directly to buy prescription drugs at cheaper rates from manufacturers.
The deal, which could potentially be this year's largest in the pharmaceutical sector, is expected to be announced as early as today, but the talks could still fall apart, the paper said.
Actavis, whose US and global headquarters are located in Dublin, and administrative headquarters in Parsippany, New Jersey, is the world's third-largest generics prescription drug manufacturer.
The merged company would have a market value of $52.7 billion and revenues of $9 billion.
Actavis has grown to be a $33.4 billion company by market value through aggressive acquisitions.
It paid $5 billion last year to buy Irish specialty pharmaceutical company Warner Chilcott Plc. Including debt, the deal was for $8.5 billion. (See: Actavis to acquire Irish specialty drug maker Warner Chilcott for $5 bn)
Actavis was established in January 2013 after New Jersey-based Watson Pharmaceuticals acquired it for around $5.60 billion, in order to expand in Europe.
It develops, manufactures and markets generic, branded generic, legacy brands and over-the-counter (OTC) products in more than 60 countries.
With 30 manufacturing and distribution facilities around the world, including in China, India, Indonesia and Singapore, Actavis is ranked among top 10 in 33 global markets.
Actavis has one of the broadest product portfolios and strongest pipelines in the generics industry. It has more than 750 molecules in 1,700 dosage combinations marketed globally through operations in more than 60 countries and around 40 per cent of its generic drug revenue comes from outside the US.
Actavis Specialty Brands, formerly known as the Global Brands business, markets more than 40 brand pharmaceutical products, primarily in the US.
Forest Laboratories, which last month acquired privately-held specialty pharmaceutical firm Aptalis for $2.9 billion, largely cater to the US market.
The company's branded drug portfolio covers five key therapeutic areas - central nerve system, cardiovascular, gastrointestinal, respiratory, and anti-infective.
Its revenue in the last fiscal year was around $3.1 billion, and the company is looking to enhance its drug portfolio following the loss of patent protection for its former block-buster antidepressant drug Lexapro.