BY OUR PHARMA CORRESPONDENT
20 July, 2005: In an effort to bolster its position in the growing over-the-counter (OTC) marketplace, Swiss drugs group Novartis has agreed to acquire Bristol-Myers Squibb's US portfolio for $660m (£379m).
BMS' OTC unit registered sales of $258m last year.Novartis currently ranks as the number two OTC firm in Europe.
Analysts have described the cash deal, which will see Novartis pay 2.6 times sales, as a fair price for the BMS' North American OTC portfolio as it allows to strengthen its hold on the US marketplace and broaden its therapeutic range.
The acquisition will help Novartis enter into $2 billion worth US adult analgesic marketplace with Excedrin, a $160m-earning pain killer. The drug, a triple combination of paracetamol, aspirin and caffeine, is the number two product in the area, with 96 per cent consumer awareness, according to Novartis.
Other brands in the BMS portfolio include Keri, a skin care product, Comtrex, for cold and flu, Vagistat, an anti-fungal, 4-Way, a nasal decongestant, Mineral Ice, a topical pain reliever, No-Doz, a sleep medicine, and Bufferin, a systemic analgesic.
Apart form providing the critical mass in the OTC market, the acquisition would boost the attractiveness of Novartis Consumer Health as a partner for switching prescription medicines to OTC status.
Analysts also noted that the deal made excellent synergy with Novartis' existing OTC product range, complementing the portfolio already sold by the company in North America.
News of Novartis' BMS came hot on the heels of a positive announcement from the company that sales and profits had exceeded expectation in the first half 2005.