French pharmaceuticals company Sanofi-Aventis (SAN.FR) Monday stepped up its move into consumer drugs by entering the U.S. market, acquiring Chattem Inc. (CHTT) for $1.9 billion.

Seeking to offset the impending loss of sales of drugs with expiring patents, Sanofi-Aventis has been increasing its presence in the over-the-counter market this year. In October, it bought French nutritional beauty supplement brand Oenobiol and it expects the entire unit to achieve sales of about EUR1.4 billion this year.

The Chattanooga, TENN.-based company, maker of products like Icy Hot pain-relieving patches and gel and ACT mouthwash, posted revenues of $454.9 million in 2008.

Sanofi said the deal will propel it to become the world's fifth-biggest over-the-counter drugs company, from number six. It estimates the world market to be worth about $20 billion a year and excutives said they expect the company to outpace the market's expected annual 3% growth rate.

The French company said most of the benefits from the deal would come from expanding Chattem's products outside the U.S. Sanofi will also hand its Allegra antihistamine prescription drug to Chattem to be converted into an over-the-counter product.

Sanofi has offered $93.50 a share for Chattem, a 34% premium over Chattem's closing price Friday. The tender will start in January and Sanofi expects to complete the transaction in the first quarter of 2010.

At 1330 GMT, Sanofi's shares were trading down EUR0.26, or 0.5%, at EUR54.44 in Paris.

-By Mimosa Spencer, Dow Jones Newswires; +33 1 40 17 17 73; mimosa.spencer@dowjones.com
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