Israeli pharmaceutical giant Teva announced Tuesday that it has finalized its acquisition of Dublin-based Allergan's Actavis Global Generics for $40.5 billion. This is the biggest acquisition deal in the Israeli pharmaceutical industry's history. As part of the deal, Teva Pharmaceutical Industries acquired Actavis Global Generics' with its U.S. and international generic commercial units, third-party supplier Medis, global generic manufacturing operations, and the global generic research and development unit as well as Allergan's international over-the-counter commercial unit and certain established international brands, an Allergan press release said. The deal will allow Teva to achieve cost synergies and tax savings of approximately $1.4 billion annually by the end of 2019. Teva also expects the deal to yield $25 million in cash flow by the end of 2019, spelling a growth rate of 11% in company revenue. Allergan is a global pharmaceutical company focused on developing, manufacturing and commercializing branded pharmaceuticals, devices and biologic products for patients around the world. The Irish company received $33.4 billion in cash and some 100 million shares of Teva stock valued at $5.4 billion, based on Teva's share value of $53.39 as of Aug. 2. The shares are subject to a 12-month holding period post-close of the transaction. The deal means Teva will have 338 products awaiting FDA approval, including 115 products with a first-submit option -- a substantial commercial advantage in the global pharmaceutical industry. Teva recently released a study showing the generic drugs it produces generated savings of about $215 billion to the U.S. healthcare system over the last decade. "The acquisition of Actavis Global Generics will help us build a new Teva, one with a more solid foundation, upgraded financial profile and more diverse revenue and profit sources," Teva President and CEO Erez Vigodman said. These efforts "are backed by growth engines based on the development of both original and generic drugs. This infrastructure will provide a multiyear growth for the company's top and bottom lines and generate a significant cash flow, which will allow for a rapid reduction of our financial debt," he said.
Teva inks biggest deal in Israeli pharmaceutical industry's history
Israeli pharma giant finalizes acquisition of Dublin-based Actavis Global Generics for $40.5 billion • Teva expects deal to generate tax savings of $1.4 billion by late 2019 and yield $25 million in cash flow • Company sets growth projection at 11%.
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