Mylan N.V., a global pharmaceutical company based in Canonsburg, Penn., and Pfizer Inc. announced yesterday a definitive agreement to combine Mylan with Upjohn, Pfizer’s off-patent branded and generic established medicines business.
The new company, which will be renamed and rebranded at close, will be based in the United States and incorporated in Delaware. It will operate global centers in Pittsburgh, Penn.; Shanghai, China and Hyderabad, India.
Mylan brings a diverse portfolio across many geographies and vital therapeutic areas as well as a robust pipeline. Upjohn brings brands such as Lipitor (atorvastatin calcium), Celebrex (celecoxib) and Viagra (sildenafil), and proven commercialization capabilities. The transaction will allow the new company to expand the geographic reach of Mylan’s existing product portfolio and future pipeline into new growth markets where Upjohn has existing sales infrastructure and local market expertise.
“Over the past year and a half, I have spent a lot of time speaking with and listening attentively to our shareholders,” Mylan Chairman Robert J. Coury said. “Today’s announcement builds upon many of those meaningful conversations and represents a transformative move for Mylan. The new company, which combines the unique assets of Mylan with the iconic brands of Pfizer’s Upjohn business, will not only accelerate our mission to serve the world’s changing health needs, but also further unlock the true value of our platform while delivering attractive returns to shareholders for many years to come. Importantly, the combined organization will have a presence across nearly every continent and major market, establishing a new leadership position in Asia and offering products capable of treating all major therapeutic areas. This combination also further accelerates Mylan’s longstanding strategy to create the operational scale and commercial capabilities necessary to provide the world’s more than 7 billion people with access to medicine.”
Coury will serve as executive chairman of the new company. Michael Goettler, current group president at Upjohn, will serve as CEO. Rajiv Malik, current Mylan president, will serve as president. Ken Parks, currently chief financial officer of Mylan, will depart the company at closing. Heather Bresch, Mylan’s current CEO, will retire from Mylan upon the close of the transaction. The board of directors of the new company will include its executive chairman and its CEO as well as eight members designated by Mylan and three members selected by Pfizer.
“We are creating a new champion for global health—one poised to bring world-class medicines to patients across a wide range of therapeutic areas,” Pfizer CEO Albert Bourla said. “I believe that Mylan’s unique profile and strategy has made it the obvious partner of choice in creating this powerful combination. By bringing Mylan’s growth assets to Upjohn’s growth markets, we will create a financially strong company with true global reach. I’m also excited about the management team, which combines strong executive talent from both companies, whose commitment to improving global health for patients and to delivering returns to shareholders are great assets for the new company. For Pfizer, this transaction represents our sharpened focus on innovative medicines and is a testament to our purpose – breakthroughs that change patients’ lives. At the same time, we’ll maintain the financial flexibility to advance our strong pipeline, invest for growth, and continue to return capital to our shareholders.”
The agreement is structured as an all-stock, Reverse Morris Trust transaction. Under the terms of the deal, each Mylan share would be converted into one share of the new company. Pfizer shareholders would own 57 percent of the new company, and Mylan shareholders would own 43 percent. The boards of directors of both Mylan and Pfizer have unanimously approved the transaction.