The deal will see Pfizer spin out its Upjohn unit—which produces the popular cholesterol pill Lipitor and erectile dysfunction drug Viagra—and combine it with Mylan. The new company will hold about US$24.5 billion in debt, but also expects sales of US$19 billion to US$20 billion in 2020. (BNN Bloomberg)

Talking point: The deal comes at a time when the generic-drug industry is under pressure as increased competition drives prices lower. It provides an opportunity for both companies: Pfizer’s Upjohn saw sales decline 11 per cent over the past year, but the deal provides a new pipeline for its products, which are no longer patent-protected and are therefore less profitable. At the same time, it will free company resources up to focus on more innovative, higher-margin R&D and drug-making. For Mylan, it provides a management shakeup at a key time for the company as its faces lower prices in generic drugs and price-fixing allegations surrounding its EpiPen allergy device.