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Last Updated: Monday, 25 September 2006, 07:19 GMT 08:19 UK
German drug market sees new deal
Pills being poured into a bottle
Firms are grouping together to boost their research capabilities
Belgian drug maker UCB is to buy German firm Schwarz Pharma for 4.4bn euro ($5.6bn; 2.9bn), the third deal in Europe's drug industry in recent days.

The latest deal will create a firm with combined sales of 3.3bn euros and an annual research budget of 770m euros.

The huge cost of researching and developing new drugs is fuelling a wave of consolidation across the sector.

German firms Merck and Altana are currently involved in transactions worth more than 14bn euros in total.

The biggest deal so far this year saw Bayer agree to buy rival Schering for 16.5bn euros in June.

Drug pipeline

Schwarz Pharma began life as a generic drug maker but now has a strong pipeline of its own drugs, specialising in neurological treatments.

The Schwarz family, which controls 60% of Schwarz Pharma's shares, has agreed to sell to UCB but will retain a large stake in the combined business, which will be listed on the Belgian stock market.

Germany's once-conservative drug sector has seen a spate of takeovers in recent months as firms try to make the high-stakes process of developing new drugs more affordable.

Merck, which lost out in the race to buy Schering, is acquiring Swiss firm Serono for 10.6bn euros.

Chemicals firm Altana is selling its pharmaceutical business to Denmark's Nycomed for 4.2bn euros.




SEE ALSO
Drug deals boost European sector
22 Sep 06 |  Business
Merck abandons Schering drugs bid
24 Mar 06 |  Business
Bayer buys Merck's Schering stake
14 Jun 06 |  Business

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