Pfizer, Mylan to Merge their Generic Drug Units

According to inside sources, Pfizer Inc. and Mylan NV are planning to merge their off-patent businesses to create a generic drug giant. Pfizer holds the credit for blockbuster drugs, such as Viagra and Lipitor.

The deal, if it goes through, can be announced early on Monday. The division of the new entity’s shares would be in a roughly 40–60 ratio, wherein Mylan investors would hold the lower percentage, while the major stake would be held by Pfizer.

One of the people who have information regarding the deal said that the combined company would be headed by Michael Goettler, who is currently heading Pfizer’s off-patent unit, while the post of executive chairman would be held by Mylan’s chairman, Robert Coury. Heather Bresch, the current CEO of Mylan, would resign after finalization of the deal, and president Rajiv Malik, who is faced with civil suits for allegedly being part of a price-fixing scheme, would be resigning eventually.

Using the Dutch governance structure as a takeover defense because many Mylan investors were frustrated with it, the business would be moved to the US. Further, as part of the deal, the new company would refinance the debts which the subsidiary of Pfizer, and Mylan are under. The story was originally covered by the Wall Street Journal. Mylan and Pfizer both refused to comment on the deal.

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