Eli Lilly to buy animal vaccines business from Boehringer Ingelheim

Eli Lilly has agreed to buy the feline, canine and rabies vaccine portfolio of Boehringer Ingelheim Vetmedica, as well as its fully-integrated manufacturing and R&D site, for $885m.

The company, which is making the acquisition through its subsidiary, Elanco US, said the deal will diversify its companion animal portfolio by complementing its offerings for dogs and cats.

In addition, the Fort Dodge, Iowa-based facility brings capacity to manufacture the acquired products as well as R&D and testing capabilities, including an on-site veterinary research centre and lab space.

Lilly’s chairman, president and chief executive officer John C. Lechleiter, said: "As a result of the acquisition, Elanco will bring greater value to customers by providing a suite of options for preventing common diseases in companion animals.

"Coupled with our robust food animal portfolio, this addition further strengthens Elanco's position in the global animal health business."

The sale of Boehringer’s US pet vaccines business and Fort Dodge site is one of the requirements for its acquisition of Sanofi’s animal-health unit, Merial.

Lilly said the current vaccine portfolio being bought has experienced revenue growth over the past three years. It expects the acquisition to be accretive to GAAP earnings in 2019 and to non-GAAP earnings in 2018.

At 1210 BST, Eli Lilly shares were up 0.5% to $81.53 in pre-market trade.