Pharmaceutical jobs provider Teva has reached an agreement to acquire Cephalon in a deal worth around $6.8 billion (£4.12 billion).
The transaction, which is expected to close in the third quarter of 2011, will allow Teva to expand its presence in the specialty and branded pharmaceuticals market, with the companies' combined branded portfolio worth $7 billion in annual sales.
In sealing the deal, Teva was able to see off competition from Valeant Pharmaceuticals, which launched a $5.7 billion hostile bid in March 2011 that was rejected by Cephalon's management.
Other stated benefits of the merger include the unification of the two firms' pipelines and research and development capabilities, while the new unified organisation will also have a significant global generics footprint.
Kevin Buchi, chief executive officer (CEO) of Cephalon, said the deal was agreed following a review of strategic options designed to deliver maximum shareholder value.
Shlomo Yanai, president and CEO of Teva, added: "We are embarking today on a new and exciting future for Teva's branded business and we are delighted that we will be working together with the Cephalon team."