October 30, 2015
By Mark Terry, BioSpace.com Breaking News Staff
After rumors that Pfizer Inc. was interested in acquiring Allergan Plc were confirmed yesterday, analysts and investors’ attention has shifted to Brent Saunders, the chief executive officer of Allergan.
Saunders, 45, has a recent history of big deals. He graduated from the University of Pittsburgh and the Fox School of Business in Philadelphia, then worked in the life science industry in various compliance positions, becoming the chief executive of Bausch & Lomb in 2010. In 2013, he sold Bausch & Lomb to Canadian firm Valeant Pharmaceuticals International Inc. for $8.7 billion.
After that sale, he shifted to heading Forest Laboratories, Inc. after an endorsement from investor Carl Icahn. Shortly after taking over Forest, the company was acquired by Actavis . Rather than leaving — or being forced to leave — Saunders teamed up with then-chief executive Paul Bisaro. Saunders took over as chief executive and Bisaro stepped up to executive chairman. Which is where they both remain today.
“Our working relationship is very collaborative and constructive,” Bisaro told BloombergBusiness. “It has been a bit unique to have an executive chairman and CEO working this closely together, but it has worked very well for us and I believe for our company and our shareholders.”
In 2014, Valeant and New York-based Pershing Square Capital Management attempted a hostile takeover of Allergan Inc. amid accusations and investigations of insider trading on the part of the Canadian company and Pershing Square. At least in part to fend off Valeant’s overtures, Allergan was acquired by Dublin-based Actavis (ACT) in March 2015 for $70.5 billion. The merger created one of the world’s top 10 pharmaceutical companies by sales revenue, with a projected 2015 revenue of about $23 billion. In June 2015, Allergan acquired Kythera Biopharmaceuticals, Inc. for about $2.1 billion. Kythera focuses on treatments for double chins and male pattern baldness.
Then in July, Allergan sold its generic drug business to Israel-based Teva Pharmaceutical industries Ltd. (TEVA) for $40.5 billion.
As Bloomberg puts it, “In the past 20 months, Saunders has turned a $25 billion company into a $120 billion one.”
And now, apparently, Pfizer is interested in acquiring Allergan, which if completed, would create the largest pharmaceutical company in the world, surpassing Johnson & Johnson $300 billion annual revenue.
Analysts have been speculating on who Pfizer would buy ever since its acquisition attempt of UK-based AstraZeneca PLC fell apart in May 2014. Potential large targets besides Allergan included Dublin-based Actavis Plc (ACT) and UK-based GlaxoSmithKline .
“Pfizer has been on the hunt for assets for awhile after the failed AstraZeneca deal,” analyst Elizabeth Krutoholow, with Bloomberg Intelligence, said yesterday in a BloombergBusiness article. “Allergan is a great target given its growth and offers an inversion.”
In addition to strengthening Pfizer’s central nervous system (CNS) and gastrointestinal (GI) market position, it would add Allergan’s biosimilars portfolio.
If a Pfizer-Allergan deal goes through, it will be interesting to see if Saunders remains with the company, potentially as a future chief executive of the largest pharmaceutical company in the world. Pfizer’s chief executive, Ian Read, is 62 and has been with Pfizer since 1978. And Saunders has a reputation for friendly relationships with other executives.
“Brent does believe in getting to know other CEOs,” Bisaro told Bloomberg. “That personal touch has served him well.”
