New York: Actavis Plc is in advanced talks to acquire rival drug maker Forest Laboratories Inc in a deal that could value Forest at up to $25bn, the Wall Street Journal reported citing people familiar with the matter.
The deal was expected to be announced late yesterday, but it is possible that the talks could still fall apart, the Journal said.
Amanda Kaufman, a Forest Labs spokeswoman, said the company does not comment on market rumours. Reuters could not immediately reach Actavis for comment outside of regular business hours.
A combined Actavis-Forest could offer a range of generic and brand-name medicines, reaping economies of scale of its own, the Journal said. Actavis competes with larger drugmakers such as Teva Pharmaceuticals Industries Ltd and Mylan Inc.
Actavis has turned to acquiring speciality branded drugs, which have far higher profit margins than generics, to boost earnings.
Forest has a market capitalisation of $19.34bn as of Friday’s close, compared with $33.40bn for Actavis, according to Thomson Reuters data.
Forest had wrangled with billionaire investor Carl Icahn for years and ultimately struck a deal with him last summer that averted a proxy fight. It is still facing patent expirations on several of its biggest drugs, including Namenda, which is prescribed to improve cognitive function in people with Alzheimer’s disease.
Forest Chief Executive Brent Saunders, who joined the company last October, would stay at the combined company, the Journal said. Saunders’ exact role is still being worked out.
Reuters
