Pfizer pays $68bn for Wyeth

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Pfizer, the world's biggest pharmaceutical company by revenue, yesterday confirmed the worst kept business secret of the last few days by announcing that it is buying fellow US group Wyeth for $68bn (£49bn).

The two groups claimed the cash-and-shares takeover created "one of the most diversified companies in the global healthcare industry" that would "respond more quickly and effectively to changing healthcare needs".

Pfizer's biggest selling drug, the cholesterol treatment Lipitor, generates $12bn a year but loses its patent protection in two year's time, when several drug companies are expected to offer cheaper generic alternatives. Analysts were largely critical of the deal, saying that the takeover of Wyeth was the easy option for Pfizer, allowing it to delay the problems it faces with the loss of Lipitor revenues. "It is a step back into the dark ages. Most are looking to the emerging markets for growth, whereas this deal will put Pfizer back into the position it is in now in another 10 years," said Jeremy Batstone-Carr, head of research at Charles Stanley.

Pfizer has secured $22.5bn of short-term debt from Bank of America Merrill Lynch, Barclays Capital, Citigroup, Goldman Sachs and JP Morgan to back the bid.