Teva Is Ready for Ratiopharm-Sized Deal, Desheh Says
Teva Pharmaceutical Industries Ltd. is ready for an acquisition the size of last year’s 3.63 billion-euro ($4.9 billion) Ratiopharm GmbH takeover as it aims to boost sales to $31 billion by 2015.
The Israeli company is weighing opportunities for acquisitions larger and smaller than Ratiopharm, in branded and generic drugs, Chief Financial Officer Eyal Desheh said in a telephone interview. Teva snatched Ratiopharm away from Pfizer Inc. last March, one in a string of deals that have helped it join the ranks of the world’s fastest-growing drugmakers.
“Are we ready for another acquisition the order of magnitude of Ratiopharm? The answer is yes,” Desheh said yesterday. “We are looking at a number of targets.”
Teva, based in Petah Tikva, Israel, is hunting for acquisitions as its best-seller Copaxone may face the double threat of new therapies and generic competition. The company estimates that a combination of its own cash flow and its ability to borrow means it will have almost $30 billion to spend over the next five years.
Teva said in January 2010 it would use less than one-third acquisitions and about two-thirds organic growth to more than double revenue by 2015.
The drugmaker believes it can meet its 2015 target without buying competitors, Desheh said. With cash available to do deals, though, Teva may seek a bigger percentage of growth from acquisitions than executives predicted when it set its long-term targets 13 months ago, he said.
“If I want to be realistic, we’ll probably do more,” he said. “We have more cash. It’s a possibility.”
Teva had about $1.2 billion in cash on hand at the end of December. Desheh declined to comment on where the companies Teva is targeting are located.
German drugmaker Stada Arzneimittel AG fell 8 cents, or 0.3 percent, to close at 28.75 euros in Frankfurt trading. The stock had traded as low as 28.50 euros prior to Desheh’s comments.
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