Pfizer has agreed to buy Hospira for about US$17 billion ($21.3 billion) to boost its portfolio of injectable drugs and biosimilars.
The company is offering US$90 a share in cash for Hospira, a 39% premium to Wednesday’s closing price.
The deal is Pfizer’s largest since it dropped its bid for AstraZeneca last year.
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“Hospira’s business aligns well with our new commercial structure and is an excellent strategic fit for our global established pharmaceutical business, which will benefit from a significantly enhanced product portfolio in growing markets,” says Pfizer chairman and CEO Ian Read.
Both sterile injectables and biosimilars are large and growing categories. Pfizer says the global marketplace value for generic sterile injectables is estimated to be US$70 billion in 2020 while the global marketplace for biosimilars is estimated to be about US$20 billion in 2020.
The transaction is subject to customary closing conditions, including regulatory approvals in several jurisdictions and approval of Hospira’s shareholders, and is expected to close in the second half of 2015.
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