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Friday, 8 June, 2001, 06:36 GMT 07:36 UK
DuPont sells drugs unit for $7.8bn
Pills poured into bottle
Bristol-Myers obtains a pipeline of experimental drugs
US drug giant Bristol-Myers Squibb has agreed to buy DuPont's pharmaceuticals unit for $7.8bn.

The move is designed to boost profits at Bristol-Myers following the expiry of patents on three of its key medicines.

The all cash sale is expected to be completed in the fourth quarter, subject to regulatory approval.

Bristol-Myers, the world's fifth biggest drugs maker, will acquire a portfolio of medicines that brought in $1.5bn in sales last year.

"This acquisition is an important step in aggressively implementing our growth strategy, which envisions expanding our medicines business through acquisitions, joint ventures, licensing and co-promotion agreements, as well as through our own intensive and productive research and development efforts," said Peter Dolan, chief executive of Bristol-Myers.

Some analysts said Bristol paid $2bn-$3bn more than the unit was worth when the auction was announced in December.

But the US company was able to outbid rivals, many of which were in Europe.

Medicine cupboard

The medicines include Sustiva for the treatment of the HIV virus and Coumadin for the breaking up of blood clots.

Bristol-Myers will also obtain DuPont's pipeline of experimental drugs, which are mostly in the first stages of human trial.

For DuPont, one of the largest US chemical companies, the sale of the drugs unit will help it restructure its businesses.

The company will retain its interest in the Cozaar/Hyzaar antihypertensive drug developed with and marketed by Merck.

DuPont will use the cash to complete a $2.5bn share buyback program which was announced last July, as well as to reduce its $9bn in debt.

DuPont struggles

In April, the company announced plans to cut 4,000 jobs, or 4% of its workforce.

Last week it said it may have to cut even more jobs, as it struggles to weather the economic slowdown in the US.

Recently, DuPont has shifted its focus from chemicals to a variety of materials for textiles, construction, automotive and agriculture as well as biotechnology.

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