For a company that's a generic-drug maker, Teva Pharmaceuticals
Teva already has $3 billion multiple sclerosis drug Copaxone in addition to a bunch of other smaller drugs. The addition of Cephalon will help Teva reduce its dependence on Copaxone, which currently makes up 21% of sales. Fellow Fool Anders Bylund thinks Teva is running scared after the introduction of Novartis's
The big question is whether Teva overpaid for the privilege. Remember, Valeant Pharmaceuticals
Teva may be OK, though. By all accounts, Valeant was really low-balling Cephalon with its offer, and Teva has been at least cursorily interested in Cephalon since before Valeant made its unsolicited offer.
Most of Cephalon's revenue comes from sleep disorder medication Provigil, but it'll go off patent next year. Whether the $6.2 billion deal pays off for Teva likely depends on the pipeline it's inheriting. It should only take one big hit or a couple of smaller ones to justify the price.
While the branded drugs are the most important aspect to the deal, there is one bonus feature right up Teva's alley. Cephalon has a generic division called Mepha, which should fit right in, especially since it used to be associated with Ratiopharm that Teva bought last year.
And Teva doesn't appear to be abandoning its roots. News reports suggest that Teva is in the process of buying Taiyo Pharmaceuticals, a generic-drug maker in Japan.