Secret Allergan Meeting Points To Aggressive Takeover Strategy

Allergan is building an acquisition machine the likes of which institutional investors and hedge funds may not yet comprehend. The company and its bold ambitions to become the dominant category leader were benchmarked in a recent secret meeting that revealed how a prototype for a next-generation acquisition model is being built. Once the firm achieves category dominance they achieve pricing power while having greater flexibility to reduce operating expenses, a corporate tactic that hedge fund managers tend to applaud, as is the case in Micron Technologies and other category leaders.

In the wake of Allergan’s recent $2.1 billion acquisition of Kythera Biopharmaceuticals, and in the process of digesting integration into Actavis and a much...