German drug giant Bayer HealthCare is selling off two of its oldest animal health products so it can pour its resources into more innovative pursuits. The company announced Wednesday that it is handing its equine products Legend/Hyonate (hyaluronate sodium) and Marquis (ponazuril) to Sanofi's ($SNY) animal health company, Merial. Financial details about the transaction, which is expected to close early next year, were not disclosed.
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| Bayer animal health chief, Dirk Ehle |
Bayer has marketed Legend/Hyonate to relieve joint disease in horses for over 20 years, and it has sold Marquis--an oral paste for treating a central nervous system disorder--for a decade, according to a Bayer press release announcing the deal. Dirk Ehle, head of Bayer's animal health division, said the products have "no strategic relevance" because they account for less than 2 percent of worldwide sales.
"This transaction will allow our business to focus on innovation and growth in core segments for both companion and farm animals," Ehle said in the statement.
Despite rumblings about a coming consolidation in animal health, this deal seems to show that Bayer is refining its presence in the industry--not pulling back from it. The company, which ranked fifth on FierceAnimalHealth's list of the top 10 animal health companies of 2013, has been aiming to set itself apart from the competition by introducing a variety of innovative products. Earlier this month, for example, Bayer launched a smartphone app called Cowdition, which allows farmers and veterinarians to track the health of dairy cows.
And Bayer CEO Marijn Dekkers has indicated that animal health remains a key element of the company's growth strategy. In 2012, Bayer acquired the animal health business of Teva Pharmaceutical Industries ($TEVA) for $145 million. Some analysts have even suggested Bayer may sell its diabetes devices and plastics units so it can fund acquisitions in animal health.
As for Merial (No. 3 on our top 10 list), buying the two products will boost its already strong portfolio of drugs, vaccines, and online tools for managing horse health. Merial CEO and Sanofi Executive Vice President Carsten Hellmann said in a press release that Bayer's equine drugs "are highly regarded by the horse community and further support our commitment to equine veterinarians, horse owners and trainers."
- here's Bayer's press release
- access Sanofi's release here (PDF)
Special Report: Top 10 animal health companies of 2013 - Bayer - Merial