NEW YORK (AP) -- Procter & Gamble Co. said Thursday that it has combined some of its drug units with Jerusalem-based Teva Pharmaceutical Industries Ltd., a move that should help the companies expand in China and other emerging markets.
Cincinnati-based P&G, the world's largest consumer products maker, and Teva, the world's largest generic drug maker, will combine their over-the-counter drug businesses outside of North America. The new joint venture, called PGT Healthcare, will be headquartered at existing P&G offices in Geneva, Switzerland.
P&G's strength in customer research and marketing will complement Teva's experience in selling to pharmacies and navigating regulations, the companies said. They also plan to combine some of P&G's popular medicines, such as Vicks cough medicine, Metamucil fiber supplements and Pepto-Bismol stomach medicine, with Teva's supplements. For example, Vicks cold medicine could be combined with Teva's allergy compound, the companies said.
P&G's over-the-counter unit in North America will also have access to Teva's compounds.
The plan was first announced in March, but the companies recently received approval from anti-trust regulators in North America and Europe to make the deal official.
P&G makes a range of products found in most U.S. households, including Pampers diapers and Tide detergent. The company approached Teva about the partnership last year after deciding it wanted to grow its consumer health unit. PGT's CEO, Briain de Buitleir, is from P&G. The chief operating officer is from Teva.
The new unit will have revenue of about $1.3 billion and plans to reach $4 billion by the end of the decade.P&G vice chairman Dimitri Panayotopoulos said the new partnership is more about creating new markets rather than taking market share from other companies.
The companies say their geographic footprints are complementary, with P&G's strength in North America, Australia, India, Brazil and elsewhere, and Teva's in Russia, Japan, Scandinavia and elsewhere. PGT will also focus on expanding in China, a relatively untapped market.
The companies said they see opportunity from a growing middle class in emerging market countries. "They are looking for better medicine and they can afford it," Teva CEO Shlomo Yanai said in an interview with the Associated Press.
About 300 employees at P&G plants in Phoenix, Ariz., and Greensboro, N.C., have been transferred to Teva, the companies said. They said that there were no layoffs as a result.