Merger talks between Valeant Pharmaceuticals and another drug maker, Actavis, have fallen through, a person briefed on the matter said on Saturday, potentially ending what would have been one of the biggest health care deals of the year.
The two companies had been in talks for some time, and under the most recent terms of the proposed deal, Valeant would have paid more than $13 billion in stock to acquire Actavis, this person said.
But the talks had been weighed down earlier this week by a number of concerns from the target company’s directors, including the size of the deal premium.
It is unclear whether negotiations will be revived.
Representatives for the two companies were not immediately available for comment.
If the talks are revived, such a takeover would be only the latest for Valeant, a Canadian drug maker with a penchant for serial deal-making. The company has made nearly 25 acquisitions in just under three years, according to Standard & Poor’s Capital IQ, seeking to bolster both its international reach and its offerings of specialty products.
Among its most recent deals were for skin care product makers: a $2.6 billion acquisition of Medicis Pharmaceutical last year and a roughly $439 million purchase of Obagi Medical Products earlier this year.
Valeant had a market value of over $22 billion as of Friday’s close, and had $920.5 million in cash and short-term investments as of Dec. 31.
Still, a deal for Actavis would be Valeant’s biggest by far. Actavis, based in Parsippany, N.J., had a market value of $12.9 billion as of Friday’s close.
The smaller drug maker, whose products include a generic version of Lipitor, is itself the product of a takeover last year between Watson Pharmaceuticals of the United States of Actavis of Switzerland.
News of the talks between the two companies was first reported by The Wall Street Journal, while news of the discussions having ended was reported by The Financial Times.
