Merck sells Merial share, but retains animal health option
pharmafile | September 21, 2009 | News story | Sales and Marketing | Merck, Merial, Sanofi, animal health
Merck & Co has got rid of its interest in animal health products company Merial prior to the merger with Schering-Plough.
Sanofi-Aventis has acquired Merck’s half of the business for $4 billion, making it a wholly-owned subsidiary of the French manufacturer.
“The sale of Merck’s interest in Merial allows us to remain on track for the closing of our merger with Schering-Plough in the fourth quarter, as planned,” said Merck chairman Richard Clark.
Merial was set up as a joint venture between Merck and Sanofi in 1997 and was last year the number three in its sector, with sales of $2.7 billion and an estimated 14% market share.
The conclusion of the Merial deal gives Sanofi an option – in line with an agreement signed in July – to combine the Intervet/Schering-Plough animal health business with Merial.
This could only happen after the Merck/Schering-Plough merger goes through, and would create a joint venture equally owned by the new Merck and Sanofi, subject to competition authority approval.
“With the new Merck, we look forward to gaining a strong market presence and pursuing valuable growth opportunities in the animal health sector,” concluded Clark.
Sanofi chief executive Christopher Viehbacher said that buying Merck’s share of Merial strengthened Sanofi’s position in the sector.
“It illustrates our strategy to grow and diversify our business in order to become a global diversified healthcare leader with a sustainable growth and a reduced risk-profile,” he said.
Hanspeter Spek, Sanofi’s executive vice president of global operations, will oversee Merial.
The company has around 5,700 staff and operates in more than 150 countries.
It joins Sanofi’s prescription pharma, vaccines (Sanofi-Pasteur MSD), OTC and generics (Winthrop) businesses.
Together they generate close to 30 billion euros, with pharma enjoying by far the lion’s share of that with an income of 22 billion euros.
However, more than a fifth of Sanofi’s sales will be at risk from generics over the next four years.
But the company has boldly pledged to at least match its 2008 level of net sales in 2013.
Viehbacher, who took over last December, has overseen the acquisitions of Zentiva, Medley, Kendrick, Shantha Biotecnics and agreed to buy Swiss generics company Helvepharm.
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