- Delivers enhanced global scale and geographic reach, including
leading positions in China and other emerging markets
- Combines Mylan’s sustainable, diverse and differentiated
portfolio of medicines with Upjohn’s trusted, iconic brands
- Creates powerful platform comprising Mylan’s pipeline engine
and supply chain and Upjohn’s commercial and medical infrastructure
and expertise
- Focused on driving returns through consistent cash flow growth,
an attractive dividend and shareholder-focused capital
policies
- Commitment to solid investment grade ratings
- Domiciled in the U.S. and governed by Delaware law
- Robert J. Coury named Executive Chairman of the new company;
Michael Goettler named CEO and Rajiv Malik named President
- Concludes work of Mylan’s Strategic Review Committee
- Mylan and Pfizer will host Investor Conference Call, Monday,
July 29, 2019 at 8:30 AM Eastern Daylight Time
Mylan N.V. (Nasdaq: MYL) and Pfizer Inc. (NYSE: PFE) today
announced a definitive agreement to combine Mylan with Upjohn,
Pfizer’s off-patent branded and generic established medicines
business, creating a new global pharmaceutical company. Under the
terms of the agreement, which is structured as an all-stock,
Reverse Morris Trust transaction, each Mylan share would be
converted into one share of the new company. Pfizer shareholders
would own 57% of the combined new company, and Mylan shareholders
would own 43%. The Boards of Directors of both Mylan and Pfizer
have unanimously approved the transaction.
This press release features multimedia. View
the full release here:
https://www.businesswire.com/news/home/20190729005307/en/
The new company will transform and accelerate each businesses’
ability to serve patients’ needs and expand their capabilities
across more than 165 markets by bringing together two highly
complementary businesses. Mylan brings a diverse portfolio across
many geographies and key therapeutic areas, such as central nervous
system and anesthesia, infectious disease and cardiovascular, as
well as a robust pipeline, high-quality manufacturing and supply
chain excellence. Upjohn brings trusted, iconic brands, such as
Lipitor (atorvastatin calcium), Celebrex (celecoxib) and Viagra
(sildenafil), and proven commercialization capabilities, including
leadership positions in China and other emerging markets.
The transaction will allow the new company to meaningfully
expand the geographic reach of Mylan’s existing broad product
portfolio and future pipeline – including significant investments
that have been made across complex generics and biosimilars – into
new growth markets where Upjohn has existing sales infrastructure
and local market expertise.
The combination will drive a sustainable, diverse and
differentiated portfolio of prescription medicines, complex
generics, over-the-counter products and biosimilars supported by
commercial and regulatory expertise, established infrastructure,
best-in-class R&D capabilities and high-quality manufacturing
and supply chain excellence.
Financial Highlights
The new company is expected to have pro forma 2020 revenues1 of
$19 to $20 billion. Pro forma 2020 adjusted EBITDA is anticipated
to be in the range of $7.5 to $8.0 billion, including phased
synergies of approximately $1 billion annually to be realized by
2023. Pro forma free cash flow for 2020 is expected to be more than
$4 billion.
The new company will be focused on returning capital to
shareholders, while maintaining a solid investment grade credit
rating. It expects to achieve a ratio of debt to adjusted EBITDA of
2.5x by the end of 2021. In addition, the new company intends to
initiate a dividend of approximately 25% of free cash flow
beginning the first full quarter after close and the potential for
share repurchases once the debt to adjusted EBITDA target is
sustained.
Leadership, Governance and Structure
The new company, which will be renamed and rebranded at close,
will be led by Mylan’s current Chairman Robert J. Coury, who will
serve as Executive Chairman of the new company; Michael Goettler,
current Group President, Upjohn, who will serve as Chief Executive
Officer (CEO); and Rajiv Malik, current Mylan President, who will
serve as President. Ken Parks, currently CFO of Mylan, has agreed
to depart the company at closing. Heather Bresch, Mylan’s current
CEO, will retire from Mylan upon the close of this transaction.
The Board of Directors of the new company will include its
Executive Chairman and its CEO, as well as eight members designated
by Mylan, and three members designated by Pfizer, for a total of
thirteen members.
The new company will be domiciled in the U.S. and incorporated
in Delaware and will operate Global Centers in Pittsburgh,
Pennsylvania; Shanghai, China, and Hyderabad, India.
Executive Commentary
Robert J. Coury, Mylan Chairman, said, “Over the past year and a
half, I have spent a lot of time speaking with and listening
attentively to our shareholders. Today’s announcement builds upon
many of those meaningful conversations and represents a
transformative move for Mylan. The new company, which combines the
unique assets of Mylan with the iconic brands of Pfizer’s Upjohn
business, will not only accelerate our mission to serve the world’s
changing health needs, but also further unlock the true value of
our platform while delivering attractive returns to shareholders
for many years to come. Importantly, the combined organization will
have a presence across nearly every continent and major market,
establishing a new leadership position in Asia, and offering
products capable of treating all major therapeutic areas. This
combination also further accelerates Mylan’s longstanding strategy
to create the operational scale and commercial capabilities
necessary to provide the world’s more than 7 billion people with
access to medicine.
As important, the transaction we are announcing today will
enhance the strength of our balance sheet by scaling and increasing
our existing strong cash flows, providing the new company with the
financial flexibility to support and accelerate deleveraging and
the expected initiation of a meaningful dividend from the first
full quarter after the transaction closes. There will also be
potential for share repurchases once the long-term leverage target
is achieved. This powerful new profile positions the new company
for sustained success and long-term value creation.”
Dr. Albert Bourla, Pfizer CEO, stated, “We are creating a new
champion for global health—one poised to bring world-class
medicines to patients across a wide range of therapeutic areas. I
believe that Mylan’s unique profile and strategy has made it the
obvious partner of choice in creating this powerful combination. By
bringing Mylan’s growth assets to Upjohn’s growth markets, we will
create a financially strong company with true global reach. I’m
also excited about the management team, which combines strong
executive talent from both companies, whose commitment to improving
global health for patients and to delivering returns to
shareholders are great assets for the new company. For Pfizer, this
transaction represents our sharpened focus on innovative medicines
and is a testament to our purpose – breakthroughs that change
patients’ lives. At the same time, we’ll maintain the financial
flexibility to advance our strong pipeline, invest for growth and
continue to return capital to our shareholders.”
Coury continued: “The combination announced today also comes
with Mylan CEO Heather Bresch’s decision to announce her intention
to retire upon deal close after 27 years of distinguished service
and leadership within Mylan. Heather has left a significant
positive mark to the benefit of our company, patients and
shareholders in so many ways including through her leadership and
execution of our efforts to create a more sustainable Mylan. Her
leadership helped to further position Mylan for this important
milestone. Her presence and her impact will not only be missed by
our Board of Directors, but also by our entire workforce of 35,000
across the world. We wish her much success with her future
endeavors.”
Heather Bresch, Mylan CEO said, “Mylan was founded nearly 60
years ago with the core purpose to provide access to medicine.
Thanks to the hard work and dedication of thousands of Mylan
employees and the transformative vision from leaders past and
present, including Board Chair Robert J. Coury, Mylan has made
significant strides toward providing that same access at a global
level for the world’s 7 billion people. And now, the creation of
this new company introduces a powerful expanded platform with the
potential for patient impact that will be truly transformative and
unique within the industry. Nearly eight years after becoming CEO,
I’m proud to say that this milestone represents the culmination of
the goals I set for myself when I challenged Mylan and our amazing
workforce to set new standards in healthcare. And so, as the
company prepares to set out on this exciting new journey under the
next era of leadership, I too have decided to pursue a new chapter
– one that will continue to be focused on serving people, patients
and public health.”
Coury continued: “Additionally, it is with great pleasure that I
welcome Michael Goettler, a seasoned and high-quality pharma
executive, as CEO of the new company. I am also pleased that Rajiv
Malik will continue to serve in the role of president. Rajiv has
been and continues to be instrumental in the building and execution
of our true one-of-a-kind and very complex platform, and he will
serve as a strong complementary partner to Michael. Lastly, I would
like to thank Ken Parks for his leadership and service to Mylan,
which has provided significant value to our company over the last
three years, and know that he will continue to do so as we work
toward a successful deal close.”
Michael Goettler, Group President, Upjohn added: “I’m honored by
the opportunity to lead this new company, which will deliver more
medicines to more patients across the globe. I’m also excited to
combine two talented and deeply experienced teams that share a
passion for providing patients with access to medicines. I look
forward to delivering on that shared commitment by combining
Mylan’s broad and diverse portfolio with Upjohn’s iconic, trusted
brands and bringing the Mylan growth products to the Upjohn growth
markets. I share Robert’s commitment to leading this new company
with a focus on total shareholder return and look forward to
working with leaders at the company towards that end.”
Mark Parrish, Chair of Mylan’s Strategic Review Committee, said:
“This compelling combination concludes the work of Mylan’s
Strategic Review Committee, which after our exhaustive review of
available alternatives best positions the company to unlock value
for our shareholders.”
A fact sheet and investor presentation are available at
https://championforglobalhealth.com.
Transaction Highlights
The combination will be effected through a Reverse Morris Trust,
under which Upjohn is expected to be spun off or split off to
Pfizer’s shareholders and simultaneously combined with Mylan. The
transaction is expected to be tax free to Pfizer and Pfizer
shareholders and taxable to Mylan shareholders. The transaction is
anticipated to close in mid-2020, subject to approval by Mylan
shareholders and customary closing conditions, including receipt of
regulatory approvals. No vote is required by Pfizer
shareholders.
Upjohn will issue $12 billion of debt at or prior to separation,
with gross debt proceeds retained by Pfizer. Upon closing, the new
company is expected to have a solid investment grade credit rating.
The new company will have approximately $24.5 billion of total debt
outstanding at closing.
Centerview Partners LLC and PJT Partners LP are serving as
Mylan’s financial advisors, and Cravath, Swaine & Moore LLP and
NautaDutilh are serving as legal counsel to Mylan. Goldman, Sachs
& Co. LLC and Guggenheim Securities, LLC are serving as
Pfizer’s financial advisors for the transaction. Wachtell, Lipton,
Rosen & Katz, and De Brauw Blackstone Westbroek are acting as
Pfizer’s legal counsel and Davis Polk and Wardwell LLP is serving
as its special tax counsel.
Preliminary Financial Profile for Pfizer Upon the Completion
of the Transaction
Pro forma for the separation of the Upjohn business, Pfizer
expects to generate 2020 revenues of approximately $40 billion,
driven by its science-based Biopharmaceuticals Group, with its
Innovative Health business units (excluding Consumer Healthcare),
including biosimilars, as well as a Hospital business unit that
commercializes a global portfolio of patent-protected and
off-patent injectable and anti-infective medicines.
In addition, Pfizer anticipates achieving Income Before Tax
margins (expenses as a percentage of revenue plus other income and
deductions) in the mid-30s% range and operating cash flow of $11 -
$12 billion. Pfizer also expects that following the closing of the
transaction the combined dividend dollar amount received by Pfizer
shareholders in the event the equity distribution is structured as
a spinoff, based upon the combination of continued Pfizer ownership
and an expected 0.12 shares of the new company granted for each
Pfizer share, will equate to Pfizer’s dividend amount in effect
immediately prior to closing.
Conference Call Information and Mylan Investor Day
Cancellation
Mylan and Pfizer invite investors and the public to view and
listen to a webcast of a live conference call with investment
analysts at 8:30 a.m. EDT on Monday, July 29, 2019.
To view and listen to the webcast visit the following websites:
www.Mylan.com/investors and www.Pfizer.com/investors, and click on
the “Analyst and Investor Call to Discuss Proposed Combination of
Mylan and Upjohn” link, or directly at
https://www.webcaster4.com/Webcast/Page/748/31241.
Information on accessing and pre-registering for the webcast
will be available at www.Mylan.com/investors and
www.Pfizer.com/investors beginning today. Participants are advised
to pre-register in advance of the conference call.
You can also listen to the conference call by dialing either
(855) 895-8759 in the United States and Canada or (503) 343-6044
outside of the United States and Canada. The password is “Analyst
Call.” Please join the call five minutes prior to the start time to
avoid operator hold times.
As a result of this announcement, Mylan is cancelling its
investor day meeting that had been scheduled for July 31,
2019.
Mylan Quarterly Results
In addition, during the call Mylan will review its financial
results for the second quarter ended June 30, 2019. The Q2 2019
“Earnings Call Presentation,” which will be referenced during the
call can be found at investor.Mylan.com. A replay of the webcast
will also be available on the website for a limited time beginning
later this week.
Non-GAAP Financial Measures
This release includes the presentation and discussion of certain
financial information that differs from what is reported under U.S.
GAAP. These non-GAAP financial measures, including, but not limited
to, adjusted EBITDA, free cash flow, ratio of adjusted debt to
EBITDA and Income Before Tax margins are presented in order to
supplement investors’ and other readers’ understanding and
assessment of the financial performance of the combined company and
Pfizer. Non-GAAP measures should be considered only as supplements
to, not as substitutes for or as superior measures to, the measures
of financial performance prepared in accordance with U.S. GAAP.
About Mylan
Mylan is a global pharmaceutical company committed to setting
new standards in healthcare. Working together around the world to
provide 7 billion people access to high quality medicine, we
innovate to satisfy unmet needs; make reliability and service
excellence a habit; do what's right, not what's easy; and impact
the future through passionate global leadership. We offer a growing
portfolio of more than 7,500 marketed products around the world,
including antiretroviral therapies on which more than 40% of people
being treated for HIV/AIDS globally depend. We market our products
in more than 165 countries and territories. We are one of the
world's largest producers of active pharmaceutical ingredients.
Every member of our approximately 35,000-strong workforce is
dedicated to creating better health for a better world, one person
at a time. Learn more at Mylan.com. We routinely post information
that may be important to investors on our website at
investor.Mylan.com.
About Upjohn
With over 130 years of experience in improving patient lives,
Pfizer Upjohn seeks to leverage our portfolio, global experience
and expertise to become the trusted partner of choice for all
stakeholders committed to improving patient health. We focus on
relieving the burden of non-communicable diseases with trusted,
quality medicines for every patient, everywhere, with the goal of
treating 225 million new patients by 2025. Upjohn brings together
20 of the industry’s most trusted brands — products such as
Lipitor®, Norvasc®, Lyrica® and Viagra® — with world-class medical,
manufacturing and commercial expertise in more than 120 countries.
Upjohn’s network of approximately 11,500 colleagues works together
to be fast, focused and flexible to ensure that patients around the
world access the healthcare they need.
About Pfizer: Breakthroughs That Change Patients’
Lives
At Pfizer, we apply science and our global resources to bring
therapies to people that extend and significantly improve their
lives. We strive to set the standard for quality, safety and value
in the discovery, development and manufacture of health care
products. Our global portfolio includes medicines and vaccines as
well as many of the world's best-known consumer health care
products. Every day, Pfizer colleagues work across developed and
emerging markets to advance wellness, prevention, treatments and
cures that challenge the most feared diseases of our time.
Consistent with our responsibility as one of the world's premier
innovative biopharmaceutical companies, we collaborate with health
care providers, governments and local communities to support and
expand access to reliable, affordable health care around the world.
For more than 150 years, we have worked to make a difference for
all who rely on us. We routinely post information that may be
important to investors on our website at www.Pfizer.com. In
addition, to learn more, please visit us on www.Pfizer.com and
follow us on Twitter at @Pfizer and @Pfizer News, LinkedIn, YouTube
and like us on Facebook at Facebook.com/Pfizer.
Cautionary Statement Regarding Forward-Looking
Statements
This communication contains “forward-looking statements”. These
statements are made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. Such
forward-looking statements may include, without limitation,
statements about the proposed transaction, the expected timetable
for completing the proposed transaction, the benefits and synergies
of the proposed transaction, future opportunities for the combined
company and products and any other statements regarding Pfizer’s,
Mylan’s and Upjohn’s future operations, financial or operating
results, capital allocation, dividend policy, debt ratio,
anticipated business levels, future earnings, planned activities,
anticipated growth, market opportunities, strategies, competitions,
and other expectations and targets for future periods.
Forward-looking statements may often be identified by the use of
words such as “will”, “may”, “could”, “should”, “would”, “project”,
“believe”, “anticipate”, “expect”, “plan”, “estimate”, “forecast”,
“potential”, “intend”, “continue”, “target” and variations of these
words or comparable words. Because forward-looking statements
inherently involve risks and uncertainties, actual future results
may differ materially from those expressed or implied by such
forward-looking statements. Factors that could cause or contribute
to such differences include, but are not limited to: the parties’
ability to meet expectations regarding the timing, completion and
accounting and tax treatments of the proposed transaction; changes
in relevant tax and other laws; the parties’ ability to consummate
the proposed transaction; the conditions to the completion of the
proposed transaction, including receipt of approval of Mylan’s
shareholders, not being satisfied or waived on the anticipated
timeframe or at all; the regulatory approvals required for the
proposed transaction not being obtained on the terms expected or on
the anticipated schedule or at all; inherent uncertainties involved
in the estimates and judgments used in the preparation of financial
statements and the providing of estimates of financial measures, in
accordance with the accounting principles generally accepted in the
United States of America (“U.S. GAAP”) and related standards, or on
an adjusted basis (“Non-GAAP measures”); the integration of Mylan
and Upjohn being more difficult, time consuming or costly than
expected; Mylan’s and Upjohn’s failure to achieve expected or
targeted future financial and operating performance and results;
the possibility that the combined company may be unable to achieve
expected benefits, synergies and operating efficiencies in
connection with the proposed transaction within the expected time
frames or at all or to successfully integrate Mylan and Upjohn;
customer loss and business disruption being greater than expected
following the proposed transaction; the retention of key employees
being more difficult following the proposed transaction; Mylan and
Upjohn’s capacity to bring new products to market, including but
not limited to where it uses its business judgment and decides to
manufacture, market and/or sell products directly or through third
parties, notwithstanding the fact that allegations of patent
infringement(s) have not been finally resolved by the courts (i.e.,
an “at-risk launch”); the scope, timing and outcome of any ongoing
legal proceedings and the impact of such proceedings on Mylan’s and
Upjohn’s consolidated financial condition, results of operations
and/or cash flows; Mylan’s and Upjohn’s ability to protect their
respective intellectual property and preserve their respective
intellectual property rights; the effect of any changes in customer
and supplier relationships and customer purchasing patterns; the
ability to attract and retain key personnel; changes in third-party
relationships; the impacts of competition; changes in the economic
and financial conditions of the business of Mylan or Upjohn; and
uncertainties and matters beyond the control of management and
other factors described under “Risk Factors” in each of Pfizer’s
and Mylan’s Annual Reports on Form 10-K, Quarterly Reports on Form
10-Q and other filings with the SEC. You can access Pfizer’s or
Mylan's filings with the SEC through the SEC website at www.sec.gov
or through Pfizer’s or Mylan's website, and Pfizer and Mylan
strongly encourage you to do so. Except as required by applicable
law, Pfizer, Mylan or Upjohn undertake no obligation to update any
statements herein for revisions or changes after the date of this
communication.
Additional Information and Where to Find It
This release shall not constitute an offer to sell or the
solicitation of an offer to sell or the solicitation of an offer to
buy any securities, nor shall there be any sale of securities in
any jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. No offer of securities
shall be made except by means of a prospectus meeting the
requirements of Section 10 of the Securities Act of 1933, as
amended (the “Securities Act”). In connection with the proposed
combination of Upjohn Inc. (“Upjohn”), a wholly owned subsidiary of
Pfizer Inc. (“Pfizer”) and Mylan N.V. (“Mylan”), which will
immediately follow the proposed separation of Upjohn from Pfizer
(the “proposed transaction”), Upjohn, Mylan and Mylan I B.V., a
wholly owned subsidiary of Mylan, (“Mylan Newco”) intend to file
relevant materials with the Securities and Exchange Commission
(“SEC”), including a registration statement on Form S-4 that will
include a proxy statement/prospectus relating to the proposed
transaction. In addition, Upjohn expects to file a registration
statement in connection with its separation from Pfizer. INVESTORS
AND SECURITY HOLDERS ARE URGED TO READ THE REGISTRATION STATEMENTS,
PROXY STATEMENT/PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS WHEN
THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT MYLAN, UPJOHN, MYLAN NEWCO AND THE PROPOSED
TRANSACTION. A definitive proxy statement will be sent to
shareholders of Mylan seeking approval of the proposed transaction.
The documents relating to the proposed transaction (when they are
available) can be obtained free of charge from the SEC's website at
www.sec.gov. These documents (when they are available) can also be
obtained free of charge from Mylan, upon written request to Mylan,
at (724) 514-1813 or investor.relations@mylan.com or from Pfizer on
Pfizer’s internet website at
https://investors.Pfizer.com/financials/sec-filings/default.aspx or
by contacting Pfizer’s Investor Relations Department at (212)
733-2323.
Participants in the Solicitation
This release is not a solicitation of a proxy from any investor
or security holder. However, Pfizer, Mylan, Upjohn and certain of
their respective directors and executive officers may be deemed to
be participants in the solicitation of proxies in connection with
the proposed transaction under the rules of the SEC. Information
about the directors and executive officers of Pfizer may be found
in its Annual Report on Form 10-K filed with the SEC on February
28, 2019, its definitive proxy statement and additional proxy
statement relating to its 2019 Annual Meeting filed with the SEC on
March 14, 2019 and on April 2, 2019, respectively, and Current
Report on Form 8-K filed with the SEC on June 27, 2019. Information
about the directors and executive officers of Mylan may be found in
its amended Annual Report on Form 10-K filed with the SEC on April
30, 2019, and its definitive proxy statement relating to its 2019
Annual Meeting filed with the SEC on May 24, 2019. These documents
can be obtained free of charge from the sources indicated above.
Additional information regarding the interests of these
participants will also be included in the proxy
statement/prospectus when it becomes available.
1 2020 Proforma Outlook Reflects Lyrica U.S. LOE and China
Volume Based Procurement
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190729005307/en/
Mylan Media Relations: Christine Waller +1 (724) 514-1968 Christine.Waller@Mylan.com
Investor Relations:
Melissa Trombetta
+1 (724) 514-1813
Melissa.Trombetta@Mylan.com Pfizer Inc. Media Relations: Patricia Kelly +1 (212) 733-3810 Patricia.Kelly@Pfizer.com Investor Relations: Ryan Crowe +1 (212) 733-8160
Ryan.Crowe@Pfizer.com
Mylan NV (NASDAQ:MYL)
Historical Stock Chart
From Mar 2024 to Apr 2024
Mylan NV (NASDAQ:MYL)
Historical Stock Chart
From Apr 2023 to Apr 2024