LOS ANGELES — Botox maker Allergan Plc confirmed Thursday it’s in early talks to combine with drug giant Pfizer Inc. in a deal that, if completed, would cap a remarkable spree of mergers that’s roiling the health care industry this year.
Allergan, an Ireland-based firm with sizable operations in the Los Angeles area, said in a written statement that it was approached by Pfizer and the discussions were “friendly,” but cautioned there was “no certainty” the talks would lead to a merger.
Allergan also declined comment on any possible terms of a deal. The company had a total stock-market value of $113 billion as of Wednesday’s close, so a Pfizer acquisition likely would have a price well above that figure.
That would be the biggest deal of a year in which companies throughout the health care industry have joined forces to reposition themselves as various market and government forces, notably the Affordable Care Act, have changed the growth outlook for the firms’ revenues and profits.
Two of the nation’s three largest drugstore chains, Walgreens Boots Alliance Inc. and Rite Aid Corp., announced a $9.4 billion merger Tuesday.
After Allergan confirmed the Pfizer talks, its stock surged 6 percent to close at $304.38. Pfizer shares dipped nearly 2 percent to $34.77.
Pfizer, based in New York, makes a long list of drugs, including Lipitor for lowering cholesterol, Viagra for erectile dysfunction and Celebrex for arthritis. But Lipitor is among the Pfizer drugs that have lost their patent protection, so the talks with Allergan could help Pfizer respond to lost sales on those drugs.
“Pfizer desperately needs a large acquisition and the resulting synergies to reinvigorate its tepid earnings growth rate,” Maxim Jacobs, an analyst at Edison Investment Research, said in a statement.
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