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February 01, 2000 3:05 p.m.
Teva Pharmaceutical Industries Ltd. Signs Definitive Agreement to Acquire Novopharm Ltd.
 February 1, 2000, Jerusalem, Israel. Teva Pharmaceutical Industries Ltd, (NASDAQ: TEVA) announced today that it had signed a definitive agreement to acquire 100% of Novopharm Ltd. from Dan Family Holdings Ltd. (the "Dan Family"). The execution of the definitive agreement follows our prior releases of October 19, 1999 and December 2, 1999 relating to the possibility of such a transaction. Upon the consummation of the transaction, the Dan Family will be entitled to receive approximately 4.2 million Teva Ordinary Shares, representing approximately 6% of Teva's outstanding share capital (on a fully diluted basis).

At closing, a portion of the shares will be issued to the Dan Family in the form of non-voting exchangeable shares of a Teva Canadian acquisition subsidiary. These exchangeable shares will be exchangeable by the Dan Family at any time, in whole or in part, into Teva Ordinary Shares at a one-to-one exchange ratio. The balance of the share consideration will be allotted to the Dan Family in the form of Teva Ordinary Shares.

It is anticipated that the closing of the transaction will take place on or before March 31, 1999.

Novopharm is a privately held group of Canadian companies, and is the second largest generic company in Canada (with a market share of about 20%). The Novopharm group also has a substantial presence in the U.S. generic market as well as in Hungary and markets its products in over 50 countries. The company's sales (the part being acquired by Teva) for the first 9 months of 1999 reached US$297 million, of which approximately 47% were in Canada, 22% in the United States and 29% in Hungary.

Novopharm's primary business is the development, production and marketing of generic prescription pharmaceuticals including sterile products, vitamins and over-the-counter products. Novopharm has more than 10 production sites situated in Canada, the United States and Hungary. The headquarters and principal production sites are based in Toronto. Novopharm presently employs approximately 2700 employees, of which approximately 55% are in Canada, 5% in the United States and 40% in Hungary.

Novopharm has been active in Canada since 1965, and established its own presence in the US generic market in 1987.

Novopharm operates in Hungary through a 55% holding in Human Serum & Pharmaceutical Manufacturing Co. Ltd. Human is an Hungarian company traded on the Budapest stock exchange, which produces sterile products for the local Hungarian market and for export to Canada, the United States and other countries.

Novopharm's research and development is focused on generic drugs. These activities encompass a wide range of technologies for slow release of tablets and capsules, injectibles and others. During the last three years Novopharm introduced into the Canadian market, the U.S. market and other markets an average of 25 new generic products per annum.

Novopharm presently has numerous pending applications for generic products with the Canadian Health authorities and with the FDA in the United States, several of which are additional to Teva's pending product list.

Selected Consolidated Financial Data -The first nine months of 1999 show moderate increases in sales with growth in net profits from ongoing activities, in comparison to the comparable period of 1998.

This data is in US$ millions (convenience translation, based on the rate of exchange at September 30, 1999 US$=Can$1.4667)

  1998 1998 (Jan-Sept) 1999 (Jan-Sept)
Sales 333.1 270.3 297.5
Net Income 5.9 3.0 7.7

At September 30, 1999, Novopharm's total indebtness to financial institutions totaled US$218 million.

The acquisition of Novopharm was approved by both companies subject to the receipt of all approvals required by Canadian, American, Hungarian and Israeli Law, upon closing, including the execution of the private placement and registration in principle of the allotted shares by the Tel Aviv Stock Exchange.

Depending on the implementation of certain pending regulations under the new corporate law adopted in Israel on February 1, 2000, Teva may be in a position to consummate the transaction without a shareholder vote. Should such a vote be required, it is anticipated that shareholders meeting would be convened prior to the end of March.

In the United States, Hart-Scott-Rodino clearance of the transaction has already been obtained. In Canada, a premerger notification has been made under the Competition Act (Canada) and the waiting period in respect thereof has expired. An application for review has been filed under the Investment Canada Act in connection with the transaction and Teva is in the final stages of obtaining approval thereunder.

The acquisition of Novopharm will enable Teva to immediately become a major presence in the Canadian pharmaceutical market, a new and interesting market for Teva, will further enhance Teva's position as a market leader in the U.S. generic market, and will further Teva's expansion into several European markets as well. The combination of Teva and Novopharm has the potential for high synergies in several areas, particularly in sales, in reduced expenses, and in R&D productivity. The Company's management believes that the acquisition will strengthen Teva's position as one of the global leaders in the generic pharmaceutical marketplace, and will be accretive already in the first 12 months from closing.

Teva Pharmaceutical Industries Ltd., is Israel's largest pharmaceutical company, with 80% of its sales outside Israel, mainly in the United States and Europe. The Company develops, manufactures and markets generic and branded human pharmaceuticals, active pharmaceutical ingredients, medical disposables and veterinary products.

Safe Harbor Statement: : This release contains forward looking statements which express the beliefs and expectations of management. Such statements are based on current expectations and involve a number of known and unknown risks and uncertainties that could cause the Company's future results, performance or achievements to differ significantly from the results, performance or achievement expressed or implied by such forward-looking statements. Important factors that could cause or contribute to such differences include the impact of pharmaceutical industry regulation, the difficulty of predicting FDA and other regulatory authority approvals, the regulatory environment and changes in the health policies of various countries, acceptance and demand for new pharmaceutical products and new therapies, the impact of competitive products and pricing, the availability and pricing of ingredients used in the manufacture of pharmaceutical products, uncertainties regarding market acceptance of innovative products newly launched, currently being sold or in development, the impact of restructuring of clients, reliance on strategic alliances, fluctuations in currency, exchange and interest rates, operating results and other factors that are discussed in the Company's filings with the U.S. Securities and Exchange Commission.