2nd UPDATE: Teva Buys Japanese Generics Maker Taiyo
16 Mai 2011 - 1:13PM
Dow Jones News
Teva Pharmaceutical Industries Ltd. (TEVA) Monday said it had
acquired a 57% stake in Japan's third-largest generic drugs maker
for $460 million in cash, significantly boosting its presence in
the country.
The deal, which gives privately held Taiyo Pharmaceutical
Industry Co. Ltd. an enterprise value of $1.3 billion, includes an
offer to buy all the remaining shares in the company.
Teva, the world's largest producer of generic drugs, said it
expects the acquisition to add to earnings within four quarters of
the deal closing, which it expects by the end of the third quarter.
It will pay for it with a mixture of cash and bank debt.
Taiyo posted sales of $530 million in 2010. It has a portfolio
of over 550 generic drugs in various therapeutic areas.
"This acquisition will enable Teva to deliver on our strategic
objective of becoming a leading player in the fast-growing Japanese
generics market. In fact, we now expect to reach our 2015 target of
$1 billion in sales in Japan ahead of schedule," Teva Chief
Executive Shlomo Yanai said in a statement.
"Japan is the second-largest pharmaceutical market in the world,
valued at $96 billion in 2010 with a relatively low rate of generic
penetration of 23%. The Japanese government has expressed its
intention to increase generic penetration to 30% by 2012," the
company added.
The Israeli company has been expanding aggressively
recently.
Earlier in May, it announced a deal to acquire U.S. specialty
drug maker Cephalon Inc (CEPH) for $6.8 billion, to boost its
presence in branded drugs. In March, Teva unveiled a joint venture
with Procter & Gamble Co. (PG) that combines their
over-the-counter drug businesses outside North America, projecting
sales of up to $4 billion by the mid to later part of the decade.
Last summer it bought German drug maker Ratiopharm for $5
billion.
The U.S. remains Teva's main market, accounting for half of its
revenue, but the company wants to expand its exposure in markets
with higher growth potential, and Monday's announcement reflects
that aim.
Teva last week said first-quarter profits rose 7%, as strength
in Europe and emerging markets help offset weakness in North
America where generic drug sales were hit by a lack of new launches
and manufacturing issues.
The company wants to reduce its reliance on Copaxone, its
leading branded treatment for multiple sclerosis, which faces
increasing competitive threats.
Last month, the drug maker reported positive data on its oral
multiple sclerosis treatment laquinimod, developed by Sweden-based
Active Biotech (ACTI.SK), which may provide a foothold in the
emerging market for oral MS treatments while also helping dilute
the dependence on Copaxone's profits.
Teva's latest deal underscores the separation in Japan between
the generic and proprietary drug industries there.
Japan's biggest makers of patented treatments are busy ramping
up multi-billion dollar acquisitions in the U.S., Europe and
emerging markets to offset product pipelines that are emptying, as
blockbuster medicines approach the end of patent protection.
In the latest and highest-priced example of that trend, Takeda
Pharmaceutical Co. (4502.TO), Japan's biggest drug maker by sales,
is homing in on a deal to buy Swiss peer Nycomed for up to $14
billion that could be announced as early as this week, people
familiar with the matter say.
Japan's fourth-biggest drug maker by sales, Eisai Co. in January
2008 bought U.S.'s MGI Pharma for $3.9 billion. A few months later,
Takeda spent $8.8 billion to buy Millennium Pharmaceuticals, a U.S.
biotech firm. Also that year, Daiichi Sankyo Co. acquired a
controlling stake in India's Ranbaxy Laboratories Ltd, an Indian
generic drugs maker, for $4.6 billion.
Teva's latest deal targets a Japanese generics maker which
underscores the attractions of Japan's fast-growing economy.
High-profile Japanese drug makers have, for their part, shown
little appetite for generics deals at home. Dwarfed by both
domestic brand-name drug makers and peers in industrialized
countries, Japan's makers of "copy-cat" medicines have been
hampered by a government-controlled system of minimum prices and
misconceptions about the quality of their products.
While use of generic drugs has been growing, progress has been
slow and the government goal of a 30% market share still seems
distant. Still, even at that level, generic products would account
for half as much of Japan's drug market as in countries like the
U.S., the U.K. and Germany.
-By Sten Stovall, Dow Jones Newswires; 44-20-7842-9292;
sten.stovall@dowjones.com
(Kenny Maxwell in Tokyo contributed to this article.)