Teva Buying Allergan Generics For $40.5 Billion; Drops Mylan Bid

Israeli drug maker Teva Pharmaceutical Industries Ltd. said on Monday it has agreed with Allergan PLC to take over Allergan Generics for $40.5 billion. Teva is already the world's biggest seller of generic medicines with a market value of about $60 billion and the acquisition "reinforces" its strategy in the generics industry, the company said. The Israeli drug maker had also been looking into buying generic-drug company Mylan NV , but said on Monday after the Allergan announcement that it has withdrawn its cash and stock proposal for Mylan. Mylan shares slumped 12% premarket in New York, while Allergan rose 5.5%. The U.S.-listed shares of Teva rallied 12% ahead of the bell. The Allergan Generics deal comes on the heels of two big announcements in which four of the largest managed-healthcare companies -- Anthem Inc. and Cigna Corp. and Aetna Inc. and Humana Inc. -- agreed to combine into two companies, in deals worth a combined $82 billion.