Adding gastrointestinal products to its dermatology, eye health and neurology portfolio
Valeant Pharmaceuticals, a multinational speciality pharmaceutical company that develops a broad range of pharmaceutical products primarily in the areas of dermatology, eye health, neurology and branded generics, is to purchase Salix for $14.5bn.
The transaction has been approved by the Boards of Directors of both companies.
Salix Pharmaceuticals, headquartered in Raleigh, NC in the US, is a leading manufacturer of gastrointestinal products with a portfolio of 22 products, including prescription brands Xifaxan, Uceris, Relistor, and Apriso, as well as a pipeline of new assets.
‘Salix’s market-leading gastrointestinal franchise is an ideal strategic fit for Valeant’s diversified portfolio of speciality products,’ said Michael Pearson, Valeant's Chairman and Chief Executive.
‘The growing GI market has attractive fundamentals, and Salix has a portfolio of terrific products that are outpacing the market in terms of volume growth and a promising near-term pipeline of innovative products. This acquisition offers a compelling opportunity for Valeant to create a strong platform for growth and business development.’
Thomas D'Alonzo, Chairman of the Board and Acting Chief Executive of Salix, added that combining Salix’s leading market position in gastroenterology with Valeant’s scale and resources would create ‘a stronger and more diverse business committed to providing better health solutions to healthcare providers and their patients’.
The combination of the two companies is expected to yield more than $500m in annual cost savings. Synergies are expected to be achieved within six months of close, mainly from reductions in corporate overheads and R&D rationalisation, Valeant said.
Valeant does not plan any reductions to Salix’s sales forces or hospital, key account and field reimbursement teams and will determine the optimal size of the primary care sales force through the integration process.
The transaction is expected to close in the second quarter of 2015, subject to customary closing conditions and regulatory approval.