Move combines $10 billion generic pharmaceutical company with its own off-patent branded and generic business.

NEW YORK— Pfizer and Mylan announced Monday a definitive agreement to combine Mylan with Upjohn, Pfizer’s off-patent branded and generic established medicines business, creating a new global pharmaceutical company.

Under the terms of the agreement, which is structured as an all-stock, Reverse Morris Trust transaction, each Mylan share would be converted into one share of the new company. Pfizer shareholders would own 57% of the combined new company, and Mylan shareholders would own 43%. The boards of directors of both Mylan and Pfizer have unanimously approved the transaction.

The new company will transform and accelerate each businesses’ ability to serve patients’ needs and expand their capabilities across more than 165 markets by bringing together two highly complementary businesses. Mylan brings a diverse portfolio across many geographies and key therapeutic areas, such as central nervous system and anesthesia, infectious disease and cardiovascular, as well as a robust pipeline, high-quality manufacturing and supply chain excellence. Upjohn brings trusted, iconic brands, such as Lipitor (atorvastatin calcium), Celebrex (celecoxib) and Viagra (sildenafil), and proven commercialization capabilities, including leadership positions in China and other emerging markets.

The transaction will allow the new company to meaningfully expand the geographic reach of Mylan’s existing broad product portfolio and future pipeline – including significant investments that have been made across complex generics and biosimilars – into new growth markets where Upjohn has existing sales infrastructure and local market expertise.

The combination will drive a sustainable, diverse and differentiated portfolio of prescription medicines, complex generics, over-the-counter products and biosimilars supported by commercial and regulatory expertise, established infrastructure, best-in-class R&D capabilities and high-quality manufacturing and supply chain excellence.

The new company, which will be renamed and rebranded, will be led by Mylan’s current chairman Robert Coury, who will serve as executive chairman of the new company; Michael Goettler, current group president, Upjohn, who will serve as chief executive officer  and Rajiv Malik, current Mylan president, who will serve as president. Ken Parks, currently chief financial officer of Mylan, has agreed to depart the company at closing. Heather Bresch, Mylan’s current CEO, will retire from Mylan upon the close of this transaction.

The board of directors of the new company will include its executive chairman and its CEO, as well as eight members designated by Mylan, and three members designated by Pfizer, for a total of thirteen members.

The new company will be domiciled in the U.S. and incorporated in Delaware and will operate Global Centers in Pittsburgh, Pennsylvania; Shanghai, China, and Hyderabad, India.