Pfizer off-loads generics unit to Mylan; Canada's cannabis sales; Q2 earnings

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Pfizer Inc. kicked off a heavy earnings week for the healthcare industry by announcing that it will combine its generics and off-patent drugs unit Upjohn with Mylan NV, possibly creating a powerhouse company in the low-cost drug market.

The combination of EpiPen-maker Mylan and Upjohn, which is devoted to Pfizer's off-patent drugs like Viagra and Lipitor, is estimated to pull in sales of almost $20 billion in 2020 and $22 billion in 2021, according to Leerink analyst Ami Fadia.

Mylan President Rajiv Malik said the combined company would own about a third of all generics and about 15% of the U.S. generic market.

"You have a portfolio that anywhere in the world can play the entire spectrum of healthcare," Malik said. "You have generics, you have brands, you have [over-the-counter], you have biologics — and we can twist and turn that by market and adjust it to local market needs, but it's a very powerful mix of portfolio."

Upjohn President Michael Goettler, who is likely to become the new company's CEO, said on an investor call that Mylan will be particularly beneficial in China, where the new company will invest its combined expertise.

"China, for the new company, is a very large opportunity, a huge market — 1.4 billion people, a huge unmet medical need and already the second-largest pharmaceutical market," Goettler said. "We have incredible capabilities in China, and Pfizer has built them over 40 years."