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| Reckitt Benckiser CEO Rakesh Kapoor |
As Pfizer ($PFE) moves forward with its agreed-upon $160 billion merger with Allergan ($ACT), analysts expect it to eventually part ways with its consumer health business. And when it does, it's got a potential buyer in Reckitt Benckiser.
An eventual divestment of the company's consumer assets is "inevitable," Exane BNP Paribas analysts wrote last month in a note seen by Bloomberg, and as Reckitt CEO Rakesh Kapoor told the news service on Friday, his company would be "very interested" in giving them a look.
For Reckitt, the addition of Pfizer's OTC products--which generate about $3.5 billion annually--would boost its own consumer portfolio, which accounts for about 31% of overall revenue and currently provides the bulk of the company's growth. A deal between the two would bring well-known brands like Advil, ChapStick and Centrum to a portfolio that already includes Nurofen painkillers and Durex condoms.
Pfizer, which helped pioneer Big Pharma's slim-down trend with an $11.5 billion sale of its nutrition business to Nestlé and an IPO for its animal health unit, has for a while now been weighing a large-scale break up, and some industry watchers expect the Allergan transaction to speed that plan along.
And Reckitt hasn't been shy when it comes to chasing Big Pharma castoffs. Last year, it raced Bayer nearly to the finish line for Merck's ($MRK) consumer unit, though it eventually bowed out, allowing the German pharma to ink a $14.2 billion deal. The year prior, it struck a $482 million pact with Bristol-Myers Squibb ($BMY) to license some of the New Jersey drugmaker's Latin American brands.
But if Pfizer's unit does come up for grabs, Reckitt may be staring down some hefty competition. Bayer, for one, has said it's gunning for the global No. 1 position in the OTC market--a space that recently changed hands when GlaxoSmithKline ($GSK) and Novartis ($NVS) teamed up to form an industry-leading joint venture. New Sanofi ($SNY) CEO Olivier Brandicourt also last month said he plans to build scale in consumer health through acquisitions.
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