NEW YORK (AP) ¿ Watson Pharmaceuticals Inc. said Wednesday it will buy smaller generic drug maker Arrow Group for $1.75 billion in cash and stock, getting access to a promising drug candidate pipeline and new markets.

Watson of Morristown, N.J., said the combined company will have about $3 billion in annual revenue and do business in more than 20 countries. The company expects the transaction to close later this year, pending review by regulators, and add to its profit in 2010.

It said privately held Arrow is one of the fastest growing generic drug companies, with $647 million in sales in 2008. Arrow owns the U.S. rights to the authorized generic version of Pfizer Inc.'s cholesterol drug Lipitor, which is the best-selling brand-name drug in the world. The generic is expected to reach the market in November 2011.

Arrow also sells a generic version of the blood pressure drug Altace, or ramipril, said Watson CEO Paul Bisaro. It is also one of the companies challenging the patent on AstraZeneca PLC's asthma drug Pulmicort, and has the right to start selling a generic version of Sepracor Inc.'s respiratory drug Xopenex starting in August 2012.

If you liked this article you might like

What's Behind the Surge in Energy Stocks

Hillary Clinton Says Prosecuting Individuals is Key to Wall Street Reform