Teva beats out Pfizer in generics takeover

Date: 19 Mar 2010

The world's largest generic-drug firm has beaten out Pfizer Inc., the world's largest research-based pharmaceutical company, by placing a $5 billion bid to take over a German generics manufacturer, according to the Reuters news service.

The Israeli firm Teva Phamaceutical Industries announced that it had agreed to pay $5 billion for the German firm Ratiopharm in a cash-and-credit deal that followed a bidding war for the company.

Ratiopharm accepted the offer in a final round of bidding that closed Thursday.

In addition to Pfizer, Iceland's Actavis Group was said to be in the running to buy Germany's second-biggest generics company, which was put up for sale after billionaire Adolf Merckle committed suicide last year.

Pfizer had hoped by buying Ratiopharm to become a major player in the growing market for generic drugs - an industry that is expected to gain momentum in coming years as drugs such as Pfizer's Lipitor and Viagra go off patent.

Insiders have speculated that Pfizer, which has inked several deals to market generic drugs in collaboration with other companies, likely will continue to look for acquisition targets in an attempt to enter this lower-margin, but higher-volume market.

Analysts have also said that generics fit in with Pfizer's recent decision to get back into consumer healthcare products and increase its presence in biologic remedies in an attempt to avoid an overreliance on blockbuster medications in its portfolio.

Source: http://www.theday.com/article/20100319/BIZ02/303199881/-1/BIZ