French merger is underway

Two more pharmaceutical companies took steps to join forces and become an industry leader, specifically in Europe. The boards of directors of the French firms Sanofi and Synthélabo presented a plan to each company's shareholders to merge the two companies into Sanofi-Synthélabo, a global pharmaceutical company with anticipated health care sales of roughly $6 billion.

Combined, the company would focus on four core therapeutic areas: cardiovascular/thrombosis, central nervous system, oncology and internal medicine. Three important drugs - Ambien,® Avapro® and Plavix® - would serve as the new company's first-string product lineup.

Together, the two companies have an additional 50 products in the pipeline, 27 of which are in Phase II and Phase III stages of development.

To promote its key pharmaceutical products, the new company would deploy a worldwide sales force of more than 8,400 sales reps, the majority of whom (5,100) would work in Europe. In North America, the company would rely primarily on Sanofi's existing sales force of approximately 850 sales reps, which ranks as the 24th leading sales force in the United States. However, Lorex Pharmaceuticals, Synthélabo's joint venture with Chicago-based Searle, would continue to market Ambien;® last year, that sales team generated sales of more than $450 million.

"A strong common corporate culture" and "shared social values" underlie the proposed merger, according to a formal statement released by the companies. In terms of market rankings, the new company would be the 2nd largest company in France, the 6th largest in Europe and the 19th largest worldwide.

The proposed merger would entail an exchange ration of 13 Sanofi shares for 10 Synthélabo shares. Sanofi agreed to divest its beauty industry businesses, including its stake in L'Oréal.

The new company would be led by Jean François Dehecq, who would serve as chairman and chief executive officer, and Hervé Guérin, who would be vice chairman and chief operating officer. PR