Sanofi-Aventis is planning to make a major move into generics and acquire the Czech drugmaker Zentiva in a deal worth around $1.66 billion euros.

The French drugmaker has made a counter offer of 40.04 billion Czech crowns for the firm which is listed on the Prague and London stock exchanges and in which it already holds a 24.9% stake. The bid comes in at a higher level than an “unsolicited voluntary takeover offer” made by the Czech financial group PPF, which in tandem with Italian insurance group Generali currently has a 19.2% holding in Zentiva.

PPF is offering to pay 950 crowns per share but Sanofi has trumped this bid by saying it will pay 1,050 crowns per share. This represents a 14.6 % premium to Zentiva’s closing price of 916 crowns on April 30, the last day before PPF made its cash offer. The news of Sanofi’s bid has pushed up the firm’s shares which stood at 1,112 crowns at midday, up 6.9%.

Sanofi says that getting control of the Czech drugmaker “carries a strong rationale” as it is “already established in the various markets where Zentiva operates”. The latter is a market leader in the Czech Republic, Turkey, Romania and Slovakia and says it is growing “dynamically” in Poland, Russia, Bulgaria, the Ukraine and the Baltic countries.

At the moment Zentiva is keeping its counsel, having already “strongly advised” shareholders “to take no action” in regards to the PPF offer. A spokesperson for the group told PharmaTimes World News this morning that the firm is not commenting on the Sanofi offer either, though a statement may be made later today.

As for Sanofi, moving further into generics would appear to be a way to provide a regular revenue stream as the firm, as well as the rest of the major players in the pharmaceutical industry, faces up to the challenges of patent expiries and pricing problems. The French firm’s bid comes days after Japan’s Daiichi Sankyo surprised observers by making an offer that could be worth up to $4.6 billion for Indian generics company Ranbaxy Laboratories.