Barr Labs to acquire Duramed, creating firm with $700 million in revenues

Barr Laboratories has signed a definitive agreement to acquire DuramedPharmaceuticals in a deal that is being valued by observers at around $590 million. When completed, the companies said, the merger will create a firm with revenues of $700 million. Barr said that the transaction is expected to be neutral to earnings in fiscal 2002 and accretive thereafter. Barr's fiscal year ends on June 30.

Barr said that the new entity will offer a complete line of oral contraceptive products and a strong pipeline of generic and proprietary oncology and female health care treatments. The firm added that it will also have "a well-financed R&D capability and significant expertise in legal, regulatory and government affairs activities." Bruce Downey, Barr's chief executive, added that his company is inheriting a strong sales force which has been instrumental in successfully marketing Cenestin (conjugated estrogens) and will provide a platform for the launch of Barr's proprietary female health care products.

Mr Downey's counterpart at Duramed, Thomas Arington, said "the potential upside of this combined entity is in the best interest of, and of excellent value for, Duramed shareholders." He added that, as one of the few companies with the intellectual property to develop and manufacture a complete line of sophisticated hormone products, "Duramed is an important resource to Barr and should position the combined company for future revenue and earnings growth."