Pliva of Croatia has accepted a takeover offer from US drugmaker Barr Pharmaceuticals, snubbing rival Actavis in favour of a deal that gives it strength on both sides of the Atlantic. Barr is now Pliva’s ‘preferred bidder’, with a formal offer due to be made later this year following antitrust clearance from the German and US authorities.

Barr has offered 705 kroner per share for Pliva, topping the 570 kuna bid by Actavis in March, which was raised to 630 kuna the following month, and valuing the Croatian company at around $2.2 billion.

In a statement, Pliva said linking up with Barr would create a company with $2.5 billion in sales, with a strong presence in the North American and Central and Eastern Europe and an emerging Western European business. The link-up would also allow the combined entity to make use of Pliva’s low-cost manufacturing base in CEE, allowing it to launch new products more cost-effectively, and provide a strengthened R&D and product portfolio.

Actavis' rival offer, valued at around $2 billion, would have created a generics company with a stronger pan-European presence but a weaker foothold in the USA.

Barr has until July 7 to gain antitrust clearances, and the company said in a statement that the closing of the tender offer is conditional upon it receiving acceptances that result in a holding of more than 50% of Pliva’s shares.

The combined company will have 60 generic products filed with the US Food and Drug Administration and more than 170 products in R&D.

For Barr, the deal represents its first foray into the European generics market, and also gives it a stronger foothold in the emerging market for biosimilar drugs – substitutable copies of brandname biologic drugs. The US company is already working with Pliva on the development of a biosimilar version of granulocyte colony stimulating factor (G-CSF), used to treat low white blood cell counts in patients undergoing cancer chemotherapy.