Teva to regain generics lead with Ivax merger

Swiss drugs giant Novartis AG had displaced Teva as the world’s biggest maker of generic drugs following its purchase of Germany’s Hexal and Hexal’s US unit Eon Labs in February.

However, Teva’s merger with Ivax will create a combined unit which will achieve estimated annual sales of over $7 billion. Novartis’ generic unit Sandoz is forecast to bring in $5 billion in sales. The new group will operate directly in over 50 countries and will employ approximately 25,000 people.

In addition to increasing its position in the generic drugs market, Teva will also gain access to Ivax’s respiratory business. Teva says this will enable the firm to strengthen its branded prescription drugs pipeline and give it a wider presence in new therapeutic areas and growth markets.

The deal with Ivax will also enable Teva to extend its reach to the Latin America and eastern European markets, as well as increase its presence in the US and Europe. It will also help Teva in its development of treatments for cancer, the central nervous system and respiratory diseases.

As part of the transaction, which is expected to be completed later this year or early 2006, Ivax shareholders are being offered $26 in cash or 0.847 Teva American Depository shares in exchange for one Ivax share.