Icelandic generic drugmaker Actavis has made an improved offer to acquire Croatia’s Pliva that values its target at $1.85 billion, in a last-ditch attempt to breathe some warmth into what has been a frosty reception by Pliva’s management.

The offer of 630 Croatian kunas (around $106) per share will be Actavis’ final bid, representing an 11% increase to its previous bid and a 40% premium to the Croatian drugmaker's share price on March 7, the day before rumours of the proposed acquisition began.

Pliva’s reaction to the improved offer was only slightly less chilly. In a statement, the Croatian company said it would consider the bid, but still believed it was too low and ‘does not fully reflect the true value of Pliva’. It also intimated that other companies may be interested in the business and a better offer may be forthcoming.

Actavis' key interest in Pliva is its reach in the fast-growing economies of Central and Eastern Europe - something that has reportedly made the Croatian drugmaker attractive to other players in the generics sector.

In a statement, Pliva said it would contact Actavis to seek further information in relation to the proposal, prior to any decision on whether to start discussions.

If the transaction goes ahead, Actavis would be elevated into third place in the global generics market, behind Teva and Sandoz and ahead of Merck KGaA of Germany. The Icelandic company has been steadily buying its way up the rankings, and since making the offer for Pliva last month has also snapped up Romanian generics house Sindan for $178 million.

Actavis has also recently acquired Hungary's Keri Pharma, Bulgaria's Higia, Denmark's Ophtha and, in the USA, Amide Pharmaceuticals and Alpharma's generics business.