Eli Lilly and Co. announced Wednesday that its Elanco animal-health unit is buying Germany-based Boehringer Ingelheim International's U.S. feline, canine and rabies vaccines portfolio, as well as related manufacturing and R&D, for $885 million.
The deal will buttress Elanco’s presence in the pet segment of animal health, which is enjoying robust growth. Future Market Insights reported this month that the segment is expected to register a compound annual growth rate of 4.9 percent globally from 2015 to 2025.
"We understand the unique bond that owners share with pets and are committed to helping those pets live longer, healthier lives," Jeff Simmons, president of Greenfield-based Elanco, said in a statement. "With a growing portfolio addressing both prevention and treatment of disease, Elanco can partner with veterinarians and pet caregivers to do just that."
The purchase adds vaccines for bordetella, Lyme disease, rabies and parvovirus to Elanco’s U.S. product portfolio, which includes products for parasiticides, pain and dermatology.
As part of the purchase, Elanco is acquiring a Boehringer Ingelheim factory in Fort Dodge, Iowa, that makes the acquired products. The facility also is equipped with R&D and testing capabilities, including a veterinary research center and lab space.
Boehringer Ingelheim’s divestiture of its U.S. vaccines business was required by antitrust regulators scrutinizing the company’s purchase of Merial, the animal health business of France-based Sanofi. Boehringer is getting Merial as part of a $25 billion asset swap with Sanofi that includes over-the-counter drugs and consumer health products.
Lilly has been aggressively bulking up Elanco in recent years, most notably with the $5.4 billion purchase of the animal health unit of Switzerland-based Novartis last year. This is Elanco's 10th acquisition since 2007.
In the second quarter of 2016, Elanco reported sales of $860 million, up 2 percent from the same period a year earlier. Lilly overall had sales in the quarter of $5.4 billion.