FTC expected to OK Pfizer's Warner-Lambert deal

Acquisition approval could come today


June 16, 2000|By BLOOMBERG NEWS

WASHINGTON - U.S. antitrust enforcers will approve Pfizer Inc.'s $119 billion acquisition of Warner-Lambert Co. to create the world's No. 1 drugmaker, people familiar with the review said yesterday.

The five-member Federal Trade Commission may act as early as today to approve the combination.

The companies agreed to divest one of two over-the-counter lice medications that compete head-to-head in U.S. drugstores, the people said. Pfizer, which makes the Viagra impotence pill, and Warner-Lambert also agreed to divest the fruits of research both companies have been conducting on a cancer drug, the people said.

The combination will enable Pfizer, which also makes the world's top-selling high-blood-pressure drug, Norvasc, to replace Merck & Co. as the world's No. 1 drugmaker. Pfizer said last month that it had reached agreement with FTC lawyers to divest one consumer product and an experimental drug in the early stages of research.

"The divestitures are nonevents," said Leonard Yaffe, a pharmaceutical analyst with Banc of America Securities. "You're still going to have the strongest drug company in the galaxy," said Yaffe, who calls Pfizer one of his "top picks."

Pfizer spokesman Brian McGlynn declined to comment. The company said yesterday that it expects to close the Warner-Lambert transaction within a matter of days. The company already has won European Union approval of the transaction by agreeing to divest three products in Europe with combined annual sales of less than $10 million.

Shares of New York-based Pfizer rose 40.625 cents to $47 on the New York Stock Exchange yesterday. The shares have risen more than 45 percent this year on optimism about the Warner-Lambert acquisition. Shares of Warner-Lambert, based in Morris Plains, N.J., rose $1.25 to $129.6875, also on the NYSE.

Pfizer intends to spend $4.7 billion on research this year as the Warner-Lambert acquisition lets it topple Merck & Co. as the world's No. 1 drugmaker. SmithKline Beecham PLC and Glaxo Wellcome PLC also will combine this year, likely spurring more drugmakers to consider combinations.

Baltimore Sun Articles
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.