Valeant to eye other targets after Cephalon escapes
By S. John Tilak
TORONTO (Reuters) - Valeant Pharmaceuticals International Inc is expected to turn its attention to other acquisition targets in the specialty pharmaceuticals landscape after pulling out of the race to buy Cephalon Inc on Monday.
Shares of the Canadian drugmaker fell as much as 10 percent, erasing some of the gains they have made since Valeant announced its takeover offer for U.S.-based specialty drugmaker Cephalon in March.
Israel's Teva Pharmaceutical Industries Ltd said on Monday it had reached a deal to buy Cephalon for $81.50-a-share, topping Valeant's $73-a-share bid.
But analysts said Valeant's push for Cephalon highlighted how aggressive Chief Executive Michael Pearson is likely to continue to be in healthcare dealmaking.
"There's going to be more deals. The way (Pearson) came out so aggressively going after Cephalon was an eye-opener for people," Susquehanna Financial analyst Gary Nachman said.
"This is just fueling more fire for the momentum we've seen as far as the M&A thesis goes in pharmaceuticals," he added.
The question for Pearson now is how he will spend the company's money. "If he sees something in the $6 billion range, he's demonstrated he's willing to go that high," Nachman said.
Shares of several drugmakers were trading up as investors bet that they would be next on Valeant's shopping list. Continued...