Last week, Pfizer agreed to shed its Italian generic drug marketing company, Dorom, by selling the unit to Israel's Teva Pharmaceutical Industries for $85 million. "This acquisition is consistent with our leadership strategy in the generic marketplace," says Israel Makov, CEO of Teva, which bills itself as among the largest generic drug companies in the world. The deal leaves Pfizer with almost no more business in generics.
Novartis is taking the opposite tack, busily building up its generics business as part of its Sandoz subsidiary. Sandoz has completed the acquisition of Sabex Holdings, the Canadian generics manufacturer, for $565 million, a deal that was first announced in June. The acquisition of Sabex, which had sales of nearly $90 million in its most recent fiscal year, establishes a presence for Sandoz in Canada and gives Sandoz a big boost in what it terms the fast-growing market for generic injectable drugs.
The acquisition is the latest in a string by Sandoz. Also in June, for example, it acquired AstraZeneca's Durascan generics subsidiary in Denmark. That purchase will enable Sandoz to establish an operational hub in the Nordic region. In 2003, generics accounted for sales of $2.9 billion at Novartis--nearly 12% of its total.