A dog standing next to animal medication produced by Elanco. Photo: Frank Rumpenhorst/AFP/Getty Images
Bayer agreed to sell its veterinary drugs business to Elanco for $7.6 billion in cash and stock.
Why it matters: It creates the world's second-largest animal health company by revenue, behind Zoetis, with a 13% market share. It also will help Bayer cut into the debt pile it built via last year's Monsanto acquisition.
- The bottom line: "Pfizer's decision to spin out its animal-health business, Zoetis, in 2013 has prodded other drugmakers to shed their veterinary units. The businesses are often stable, profitable operations whose fortunes are more tied to macroeconomic trends like rising global wealth and protein consumption, instead of risky bets on drug research," writes Bloomberg's Riley Griffin.