US-managed generics drugmaker Mylan, now domiciled in the Netherlands, is said to be preparing a "poison pill" defense to escape its pursuit by Israeli generics giant Teva.

Teva has offered $40.1 billion to acquire its smaller rival, which itself is pursuing a smaller player, Perrigo. Analysts have speculated that Mylan's grab for Perrigo was a tactic to help fend off Teva. Perrigo has now rejected Mylan's nearly $29 million takeover bid.

The Israeli drugmaker's offer is contingent on Mylan not completing the proposed deal with Perrigo.

While Mylan has not yet officially responded to the Teva offer, it has issued a statement saying it was "fully committed" to its standalone strategy and its proposal to acquire Perrigo.

In moving its headquarters out of the US, through a $5.3 billion deal to acquire parts of Abbot Labs' generics portfolio, Mylan not only escaped US corporate taxes, reports say. Through the relocation, the drugmaker is now able to benefit from anti-takeover defenses anchored in Dutch law.

The poison pill Mylan will be able to leverage foresees the board creating an independent foundation that can exercise a call option agreement set up between itself and the company, diluting the rights of ordinary shareholders.

The foundation would have the right to exercise the call option if it feels it is in the best interest of the company. This would free management to pursue alternative plans.

Teva meanwhile has been pressing ahead with its quest for Mylan, announcing that it could "promptly" divest some of its operations to obtain regulatory clearance. The company said it planned to work with antitrust authorities to assure that the deal can be completed by the end of 2015; however, it did not reveal which operations it might be prepared to divest.

Citing people familiar with the matter, the news agency Reuters said some of Mylan's top investors, including Paulson and Co - a New York-based hedge fund that owned around 3% of Mylan at the end of 2014 - have encouraged the company's board to consider the proposal.

Teva said the acquisition of Mylan would create an entity with more than $30 billion in annual revenue, add to earnings in the first year and eventually generate $2 billion in annual savings.

The purchase of Mylan would also help the Jerusalem-based group expand its offering of harder-to-produce medical products such as soft-gel caps, topical and inhalant technologies and injectables, while increasing its portfolio of treatments for the nervous system.

Teva has come under pressure through the emergence of generic competition for its multiple sclerosis drug Copaxone, as well as from new oral treatments.

A merger of Mylan and Teva would create a generics giant with annual sales of around $30 billlion and market capitalization of around $100 billion. It also would be the biggest pharmaceutical industry deal so far this year and the second largest of the past 12 months, following the takeover of Botox manufacturer Allergan by generics rival Actavis.

The latter deal followed a failed hostile takeover attempt by Canadian pharmaceutical producer Valeant in cooperation with activist investor Bill Ackman's Pershing Square Capital Management. Market speculation has it that Valeant and Novartis' generics arm Sandoz may be interested in acquiring Perrigo.

Sandoz is currently embroiled in a patent dispute with Teva over a generic MS drug that would compete with Copaxone.