By Tess Stynes
Mylan NV on Monday said its board unanimously rejected the
unsolicited bid from Teva Pharmaceutical Industries Ltd., the
latest move in a three-way tussle as the generic-drug industry
faces challenges from slowing growth.
Robert J. Coury, Mylan's executive chairman, said Teva's roughly
$40 billion offer grossly undervalues the company and "would
require Mylan's shareholders to accept what we believe are
low-quality Teva shares in exchange for their high-quality Mylan
shares." He added that the transaction "lacks industrial logic and
carries significant global antitrust risk."
Mr. Coury further stated that the board wouldn't consider
engaging in any takeover talks unless the starting point is
"significantly in excess of $100 per share."
Mylan also said it remains committed to its offer for Perrigo
Co., which some have seen as an effort to prevent a potential
purchase by Teva. Mylan on Friday raised its offer to buy Perrigo
to about $33 billion and was promptly rebuffed.
At the heart of the deal-making frenzy in the pharmaceutical
industry is a quest for new revenue amid pricing pressure from
cash-strapped governments and insurers, and increased
competition.
In a separate statement, Teva reiterated its commitment to its
Mylan offer, valued at $82 a share, and said it was prepared to
"devote all necessary resources" to complete the proposed deal.
Erez Vigodman, the Israeli drug maker's chief executive, said
Teva's board and management are eager to work with Mylan to quickly
complete a transaction.
Teva also said its offer would deliver more value to Mylan's
stockholders than any other alternative, and it offered
reassurances that the proposed deal makes strategic and financial
sense and that any regulatory requirements can be met in a timely
fashion.
Mylan's Mr. Coury, meanwhile, pointed to Teva's challenges in
recent years, including the approval of the first generic version
of Copaxone and "persistent turnover and turmoil amongst the Teva
leadership and board."
A Teva takeover of Mylan would create the world's top-selling
generic-drug company with more than $30 billion in sales in 145
countries. Mylan and Teva are both generic-drug companies with a
popular branded product: the EpiPen allergic-reaction treatment in
the case of Mylan and the Copaxone multiple-sclerosis drug at
Teva.
In afternoon trading Monday, shares of Mylan fell 6% to $71.48
and Teva decreased 4.3% to $61.64. Perrigo shares were down 2.2% to
$188.74.
Write to Tess Stynes at tess.stynes@wsj.com
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