The European Commission has given a green light for Israeli drugmaker Teva Pharmaceutical Industries’ planned $7.4 billion purchase of US rival Ivax Corp, which will create the world’s number one generic company, overshooting current leader Novartis.

Under the deal, Teva will gain the rights to produce generic copies of various top-selling brand-name drugs, including Pfizer’s blockbuster antidepressant Zoloft (sertraline) and Merck & Co's prostate drug Proscar (finasteride), as well as access to Ivax' respiratory business.

The companies are still awaiting approval by the US Federal Trade Commission, but expect the transaction to complete later this year or early 2006.