16.07.2009

Animal Health Drug-Makers

Four of the world’s biggest drug-makers are likely to compete for Pfizer and Merck animal-health products. Novartis, Eli Lilly, Bayer and Boehringer Ingelheim may seek to buy animal-health businesses from Merck and Schering-Plough Corp. with a combined $4.27 billion in sales last year.
Pfizer’s animal products with as much as $400 million in sales will also draw interest.
The assets are being sold because Pfizer, the purchaser of Wyeth, and Merck, the buyer of Schering-Plough, have been told by regulators the acquisitions may make them too dominant in the animal-health market.
Merck is considering whether it would prefer to divest the Intervet/SPAH unit or the Merial division it co-owns with Sanofi-Aventis.
The most attractive of the assets would be Intervet/SPHA, because the buyer would get an entire business. Novartis, Bayer and Boehringer, all of which have existing animal-health businesses, would be candidates to buy Intervet/SPAH, which may cost $9 billion. 
Sanofi has the right to buy Merck’s share of Merial if they can match a rival bid.
Sanofi-Aventis, Eli Lilly, Bayer, Novartis and Boehringer Ingelheim submitted offers in the first round of bidding. All roads point to Sanofi winning, but it's a matter of price. Final decision expected by the end of July
When Pfizer, completes its purchase of Wyeth, set to close by the end of the year (a $68 billion merger), it will have the world’s biggest animal business, with about $4 billion in annual revenue. Pfizer spokeswoman Joan Campion said the drug-maker may have to divest some of its animal health assets to complete the Wyeth transaction.