According to both The Wall Street Journal and The New York Times, gastrointestinal specialty drugmaker Salix Pharmaceuticals has agreed to a $158 per share, $10.4 billion buyout from Valeant Pharmaceuticals. Sources say that including debt, the deal totals up to around $14.5 billion.

More on the Valeant acquisition of Salix

The Salix deal came together in just three weeks, noted Valeant CEO J. Michael Pearson. He said he was approached by one of Salix’s bankers and informed that the company was up for sale, so his team traveled to Raleigh and began negotiating the deal.

However, the deal wasn’t a shoe-in. UK pharma group Shire had been considering making an offer for Salix up until just a few days ago, according to knowledgeable sources.

“This happened all quite quickly,” Pearson commented in an interview with the New York Times on Sunday. “One of the reasons we were able to get this deal done is because we were prepared to move fast.”

The forms calculate said the combined entity could result in cost savings of at least $500 million within six months, largely by reducing corporate overhead and duplicative research and development spending. The deal is anticipated to close by June.

Another shoe dropping in a frenzy of pharma sector acquisitions

A Valeant-Salix transaction brings together two firms who tried to make deals last year in the ongoing frenzy of deal making in the pharmaceutical sector. Analysts say that pharma firms are looking for mergers that would increase efficiency and keep up with rivals.

Of note, Valeant failed in a hostile effort to acquire Botox maker Allergan last year, who was eventually snapped up by Actavis for $66 billion.

In fact, Allergan discussed an acquisition with Salix when Valeant was pursuing them, though the discussions never came to fruition. Actavis also looked closely at Salix last summer, the sources noted.

Also of note, Salix canceled its deal to acquire a unit of Italian drug maker Cosmo Pharmaceuticals because of shareholder grumbling and political pressure to not participate in a foreign tax inversion deal.

Pharmaceutical company mergers increased dramatically in 2014 to $267 billion, twice the total in 2013. Moreover, the trend is showing no signs of slowing down as Shire PLC acquired NPS Pharmaceuticals just a few weeks ago.

salix pharmaceuticals