Teva buys Bentley

Teva Pharmaceutical Industries has agreed to acquire Bentley Pharmaceuticals for US$360 million. US-based Bentley manufactures both branded generic and generic products; its principal market is Spain, though it also sells generic pharmaceuticals in other parts of the EU. These efforts are supported by finished dosage and API manufacturing facilities. Teva noted that it intends to make Bentley's generic pharmaceutical operations serve as the platform on which Teva hopes to build a leading position in Spain.

The Bentley purchase follows a string of investments from Teva in the region. In January, the Israeli manufacturer announced its plans to expand its operations in Hungary, with an investment of US$100 million at its Debrecen site. It then announced in March that it is expanding its operations in Ireland, with a €65 million (US$99.6 million) investment in its existing Waterford facilities in the southeast of the country. Later in the month, meanwhile, Teva’s IVAX unit revealed that it is to spend CZK1 billion (US$60.7 million) to expand its Opava plant in north Moravia, Czech Republic. This aggressive European expansion follows Teva CEO Shlomo Yanai’s recent comments that Teva should double its revenues by 2012; clearly, the new CEO feels that Europe is where the firm’s immediate priorities lie.

Teva’s European expansion is being mirrored by Aurobindo Pharma, which has just announced that it is to purchase the Italian operations of German pharmaceutical company TAD Pharmaceuticals. The TAD Italy purchase is Aurobindo’s third in Europe, following the purchase of Milpharm, and Pharmacin International in 2006 and 2007.

The latest acquisitions correlate with industry insiders’ predictions that a handful of generic manufacturers will lead the drive towards consolidation; Aurobindo will be hoping to be amongst this group, while Teva will certainly feature. Both have adopted a similar strategy of targeting markets where generics are less well established, i.e. Italy and Spain. It will be interesting to see if this tactic is more fruitful than a focus on established markets, where firms have recently been struggling to digest acquisitions.

Jonathan Way - Editor, World Generic Markets