The rumours have surfaced in the wake of Teva's $3.4 billion (2.7bn) takeover of US company Sicor to create a major new player in generics and API supply.
Agis has confirmed that it is in talks, but has declined to name the partner. The Haaretz newspaper reported that IVAX plans to offer $1.0-$1.2 billion for Agis in an all share exchange. Agis' chairman told the newspaper that "nothing has been agreed, and there is no certainty that the deal will go through," although the Haaretz, citing sources close to the firm, said merger negotiations are at an advanced stage.
Earlier this year, Agis denied a report in the Haaretz that it is in talks to sell its business in developing and manufacturing raw materials and pharmaceuticals to US-based Barr Pharmaceuticals for $900 million. And the US chemicals subsidiary of the Israeli group - Chemagis - has also said that merger discussions are ongoing.