Bayer HealthCare LLC and Teva Pharmaceutical Industries Ltd. (NYSE: TEVA) announced today that they have signed an agreement in which Bayer will acquire the U.S. based animal health business of Teva for up to $145 million.
The purchase price includes an upfront payment of 60 million USD plus a total of 85 million USD in milestone payments, which are linked to the successful and timely achievement of manufacturing and sales targets. The acquisition allows Bayer to expand its companion and food animal product lines in the United States by integrating the acquired assets into its animal health business.
The transaction reflects Teva’s commitment to focus its efforts on human health and its core expertise of providing generic and branded medicines to patients around the world. The transaction, encompassing a manufacturing site in St. Joseph, Missouri and around 300 employees, is expected to close in 2013, subject to antitrust clearance and satisfaction of other conditions.
“We are pleased with the sale of our animal healthcare business to Bayer HealthCare, a leader in animal healthcare,” stated Itzhak Krinsky, Group Executive Vice President and Head of Business Development of Teva Pharmaceutical Industries Ltd. “Today’s transaction represents a successful outcome for both parties and is a part of our global strategic planning. We are committed to making disciplined decisions that focus on our core businesses and strategically position the Company as setting a new standard in both generic and branded medicines. As part of our overall strategy to refine our global footprint, we will continue to leverage our product portfolio and R&D efforts while selling or out-licensing assets that no longer fit within the scope of our business.”
If approved, the acquisition will further strengthen Bayer’s food animal franchise, bringing a range of anti-infective solutions to treat infections in livestock populations and introducing reproductive hormones to Bayer’s product offerings. Additionally, it will broaden Bayer HealthCare Animal Health’s growing companion animal business by expanding its current offerings to also include dermatological, pet wellness and nutraceutical products.
“Bayer’s acquisition of Teva Animal Health will further strengthen and broaden our U.S. range of animal care solutions so that, together with our customers, we can continue to protect, cure and care for animals across America,” said Ian Spinks, President and General Manager, Bayer HealthCare Animal Health North America. “The businesses are a great strategic fit,” he continued, “and Teva’s animal health portfolio adds new depth for us across both the companion and food animal areas. We believe it will be a win-win for both our customers and our combined employee bases.”
Teva Animal Health’s portfolio of companion animal products features a full line of dermatology products sold under the DVM Pharmaceuticals brand, including such products as Malaseb, HyLyt, Relief and others. The companion animal business also has a broad line of nutraceuticals encompassing joint and gastro-intestinal products, including the Synovi brands. Food animal products acquired from Teva include a broad range of anti-infectives, in addition to parasiticides, anti-inflammatory brands and reproductive hormones such as Prostamate and Ovacyst.