Why Actavis, a Generic Drugmaker, Tops the BBW50

1: Actavis
Market Cap: $11b
Revenue: $5.7b
EPS: $1.29

Five years ago, Paul Bisaro took over Watson Pharmaceuticals, a company that rang up 99 percent of its sales inside the U.S. “For us to be successful as a first-tier generics company, we had to have a global footprint,” he says. It cost $5.61 billion, but the Parsippany (N.J.)-based company has one now. That’s the price Watson paid to buy Icelandic competitor Actavis and assume its name in a deal that closed late last year. Since then the stock has climbed 24 percent, capping a five-year stretch over which the shares gained 231 percent. That performance helped drive Actavis to the top of this year’s Bloomberg Businessweek 50 ranking of top-performing companies in the Standard & Poor’s 500-stock index.

Actavis is now the fourth-biggest generic drugmaker by sales. IMS Institute for Healthcare Informatics projects generic sales will increase at least 65 percent from 2011 to 2016, to more than $400 billion, compared with 3 percent to 8 percent in the larger branded market.