Sanofi and Boehringer Ingelheim announced the signing of contracts to secure the strategic transaction initiated in December 2015 which consists of an exchange of Sanofi’s animal health business (“Merial”) and Boehringer Ingelheim’s consumer healthcare (CHC) business.
This step marks a major milestone before closing of the transaction which is expected by year-end 2016 and remains subject to approval by all regulatory authorities in different territories. The integration of Boehringer Ingelheim’s Consumer Healthcare (CHC) business into Sanofi and Merial into Boehringer Ingelheim would start after closing.
Upon closing this transaction will be a significant business swap in the pharmaceutical sector and an important event in the history of both companies.
The strategic swap lays the foundation for both companies to reach size and scale in two highly attractive pharmaceutical activities. Upon successful completion,
Boehringer Ingelheim’s CHC business – with an enterprise value of €6.7 bn – would be transferred to Sanofi and Sanofi’s Merial – with an enterprise value of €11.4 bn – would be transferred to Boehringer Ingelheim. The transaction includes a cash payment to Sanofi of €4.7 bn to reflect the difference in value of the two businesses. Taking into account the expected contribution from the acquired CHC business, progressive implementation of synergies and the use of part of the net proceeds to buy shares back, Sanofi expects the overall transaction to be business EPS neutral in 2017 and accretive afterwards.
Combining Merial and Boehringer Ingelheim’s complementary portfolios and technology platforms in anti-parasitics, vaccines and pharmaceutical specialties would put the combined company into a more competitive position in the key growth segments of the industry and bring more value and innovation to customers globally. The Boehringer Ingelheim Animal Health business would more than double its sales to approx. €3.8 bn based upon 2015 global sales.
With this transaction, Sanofi would integrate Boehringer Ingelheim’s CHC business in all countries except China. Joint CHC sales would amount to approx. €4.9 bn2 based upon 2015 global sales. Thanks to the addition of a highly complementary product and brand portfolio, Sanofi would enhance its position in several of its strategic categories – Pain Care, Allergy Solutions, Cough & Cold Care, Feminine Care, Digestive Health and Vitamins, Minerals and Supplements.
Boehringer Ingelheim’s CHC activities
Boehringer Ingelheim Consumer Healthcare is the 8th largest Consumer Healthcare business in the world. Sales of Boehringer Ingelheim’s CHC business were €1.51 bn in 2015, contributing 10 per cent to Boehringer Ingelheim’s net sales. It aims to create and drive inspiring and sustainable solutions that will efficiently develop compelling and true global brands for consumers.
The leading brands of Boehringer Ingelheim’s CHC business are the antispasmodic Buscopan® (2015 sales of €223 million; mainly sold in Europe and Emerging Markets), the laxative Dulcolax® (2015 sales of €225 million; sold in more than 40 countries with a strong presence in the U.S.), the multivitamins Pharmaton® (2015 sales of €140 million, with majority of sales in Emerging Markets), the cough treatments Mucosolvan® (2015 sales of €168 million, mainly in Germany and Russia) and Bisolvon® (2015 sales of €96 million with a worldwide presence with largest countries being Spain and Italy) and the sore throat treatment Mucoangin®/Lysopaïne® (2015 sales of €54 million).
Merial is a world-leading, innovation-driven animal health company, providing a comprehensive range of products that focus on disease prevention and overall health and wellness in animals, Merial has three main business areas: pets, farm animals, and veterinary public health, and its health solutions target more than 200 diseases and conditions across a variety of species. Merial employs 6,900 people and operates in more than 150 countries worldwide with over €2.5 billion of sales in 2015. Merial is a Sanofi company. For more information, please see www.merial.com
The main Merial brands in the field of pet health include Frontline®, Heartgard®, NexGard®, Broadline® and Purevax®; and in farm animals Vaxxitek®, Eprinex®, Ivomec®, Longrange®, Circovac® and GastroGard®. As part of our commitment to innovation and excellence, Merial has a global footprint with 13 R&D centers and 15 production sites.
About Boehringer Ingelheim Animal Health
Boehringer Ingelheim Animal Health is the 6th largest animal health business in the world and is committed to providing leading innovative solutions to prevent, treat and cure animal diseases. With 3,800 employees worldwide, Boehringer Ingelheim Animal Health achieved net sales of about € 1.36 billion in 2015, representing 9% of the corporation’s revenue base. Main brands of Boehringer Ingelheim’s Animal Health portfolio are Ingelvac Circoflex® (2015 sales of € 281 million), Metacam® (2015 sales of € 101 million), Ingelvac® PRRS (2015 sales of € 99 million) and Duramune® (2015 sales of € 88 million).
The Boehringer Ingelheim Animal Health Business is global leader in swine vaccines and holds attractive positions in companion animal and cattle vaccines as well as in pharmaceutical specialties for animal use. The company researches and develops therapeutic solutions for animals in the US, Germany, China, Mexico and Japan. In its research-driven Animal Health business, Boehringer Ingelheim continually invests around 12% of net sales of the Animal Health business in R&D.
Sanofi, a global healthcare leader, discovers, develops and distributes therapeutic solutions focused on patients' needs. Sanofi is organized into five global business units: Diabetes and Cardiovascular, General Medicines and Emerging Markets, Sanofi Genzyme, Sanofi Pasteur and Merial.
About Boehringer Ingelheim
Boehringer Ingelheim is one of the world’s 20 leading pharmaceutical companies. Headquartered in Ingelheim, Germany, Boehringer Ingelheim operates globally through 145 affiliates and a total of some 47,500 employees. The focus of the family-owned company, founded in 1885, is on researching, developing, manufacturing and marketing new medications of high therapeutic value for human and veterinary medicine.
Social responsibility is an important element of the corporate culture at Boehringer Ingelheim. This includes worldwide involvement in social projects through, for example, the initiative “Making More Health” while also caring for employees. Respect, equal opportunity and reconciling career and family form the foundation of mutual cooperation. The company also focuses on environmental protection and sustainability in everything it does.
In 2015, Boehringer Ingelheim achieved net sales of about 14.8 billion euros. R&D expenditure corresponds to 20.3 per cent of net sales.
For more information please visit www.boehringer-ingelheim.com
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