Teva Pharmaceutical Industries is looking to buy more shares in Mylan, positioning itself for a possible legal challenge to the generics drugmaker that has spurned its takeover bid, people familiar with the matter said.
The strategy is a sign of Teva's commitment to its $40 billion bid for Mylan, as the latter presses on with its own $34 billion hostile bid for over-the-counter drug company Perrigo.
Teva last week disclosed a 1.8 percent stake in Mylan, which blasted the move as breaching U.S. antitrust laws because of the stake's size. U.S antitrust laws bar companies from acquiring stakes worth more than $76.3 million in rivals without first obtaining regulatory approval. Teva's stake in Mylan far exceeds that threshold.
The dispute boils down to where Mylan, which is incorporated in the Netherlands, has its "principal" offices. Mylan argues these are located within the United States for the purposes of the U.S. Federal Trade Commission, thereby affording it antitrust protection, even as it lists its principal executives offices in Britain in filings with the U.S. Securities and Exchange Commission.