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http://washpost.bloomberg.com/Story?docId=1376-MVGBTY0YHQ0X01-3K704JHALBE5UR8RP4S3JNOGMN

Reckitt Heroin Addiction Treatment Seen Luring Shire: Real M&A

Trista Kelley and Matthew BoyleOct 31, 2013 8:13 am ET


(For a Real M&A column news alert: SALT REALMNA <GO>.)

Oct. 31 (Bloomberg) -- Reckitt Benckiser Group Plc’s heroin addiction treatment could tempt drugmakers from Shire Plc to Actavis Plc to bid for the company’s pharmaceuticals unit.

Shire has been on the hunt for deals to ease reliance on its best-seller Vyvanse for attention deficit hyperactivity disorder. The Dublin-based drugmaker could be a logical buyer for the unit because it has managed competition with generics before and is adept at handling complex U.S. rules to curb illicit use of prescription medicines, Liberum Capital Ltd. said. While generic variants of Reckitt Benckiser’s Suboxone were introduced this year, the drug still dominates the U.S. market and a new injectable treatment is under development.

Shire surged to a record this week, increasing its ability to finance an acquisition with stock, and also has more cash on hand than 99 percent of specialty drug companies, according to data compiled by Bloomberg. Generic-drug makers Valeant Pharmaceuticals International Inc. and Actavis also may be interested in the RB Pharmaceuticals unit based on their experience extracting profits from assets that, like Suboxone, have declining sales, Sanford C. Bernstein & Co. said.

“There is definitely a lot of future potential in RB Pharma,” said Andrew Wood, an analyst at Bernstein in Singapore. “There must be some pharma companies out there who think that they can do even better, and take it to the next level.”

Weighing Options

Reckitt Benckiser said this month that it’s weighing options for its pharmaceuticals unit, whose main drug Suboxone treats addiction to opioids including heroin. The company, which also makes French’s mustard, Nurofen painkillers and Durex condoms, hasn’t yet hired advisers and said it plans to update investors on the progress of the review next year.
 


















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