Mylan Laboratories Inc., one of the world's biggest makers of generic drugs, has agreed to acquire King Pharmaceuticals Inc. for about $3.37 billion in stock to expand its branded drug business, the companies said Monday.
The transaction was not welcomed by Mylan's shareholders, who sent the company's shares down more than 16% amid concern that King is not worth the price.
King's most important product is Altace, a drug for hypertension that generates annual sales of about $450 million. Mylan hopes to use the Altace sales force to help market a new hypertension drug of its own called nebivolol, which is being reviewed by the Food and Drug Administration.
But some analysts said nebivolol might not be successful enough to justify spending so much on a sales force. And King's other products, such as the muscle relaxant Skelaxin, may face generic competition within the next two years.