From just being another generics drug maker the past five years, Actavis has earned a spot in one of the Top 10 pharmaceutical companies in the world by market value-thanks to its strategic dealmaking with the $66 billion acquisition of Allergan, Inc.
The deal was announced on Monday, Nov. 17 and would make Actavis worth $100 billion, an increase of almost $5 billion since 2009.
As of the moment, Actavis reports earnings per share of $25 in 2017, a whopping 84 percent more than analysts' estimates for this year.
Actavis plans to use Allergan's most popular drugs, including Botox to be marketed to primary care doctors aside from specialists to generate more revenue.
The company may be able to get more sales from Botox by marketing it more aggressively as a migraine medication, and with Restasis for dry eye.
Both areas are still not ventured into with doctors whom Allergan's specialist-focused sales force hadn't reached, said Bill Meury, executive vice president for North American branded commercial operations for Actavis, on a conference call with analysts yesterday.
Furthermore, Allergan's drugs give Actavis access to the opthalmology market and further reach in dermatology, helping broaden the array of products it can promote to doctors.
"It's going to be the best deal I've ever done in my career," Chief Executive Officer Brent Saunders said in a telephone interview. "Size was never a goal and doesn't remain a goal. It's about driving growth on the top line and leveraging growth on the bottom line."
Actavis had to outbid a hostile offer from Valeant Pharmaceuticals International, Inc., led by activist investor Bill Ackman.
Valeant retracted the offer yesterday saying that it couldn't make an offer as high as Actavis. Actavis shelled out more than $210 per share, or over $62 billion for Allergan, while Valeant offered $53 billion.
The transaction, the largest in the pharmaceutical industry this year, took place against a backdrop of one of the busiest merger-and-acquisition environments in the history of the industry.
Companies are jockeying for the choicest assets to fill out their collections of top-selling drugs, while seeking savings on costs and taxed.
