The bid would allow the drugmaker, which already controls 56 percent of the biotech, to gain control of all the revenues generated by such big-selling meds as the Avastin and Herceptin treatments, as well as access to Genentech’s developing portfolio.

“The pharmaceutical industry has changed fundamentally in the last 20 years, and the trend to consolidation continues unabated,” Roche Chairman Franz Humer told a briefing earlier today, Reuters reports. “It is, therefore, essential for the company as a whole to have a stronger and more effective market presence, if we are to not only maintain but extend out position in the face of growing challenges and pressure on prices.”

However, some analysts believe the $89-a-share offer, which works out to nearly $44 billion, may have to be raised, since it represents only a 9 percent premium over Genentech’s closing stock price. Meanwhile, Roche estimates the deal could save between $750 million and $850 million annually (see the Roche statement).

[UPDATE: In an investor note, Rodman & Renshaw analyst Michael King writes that "the $89 opening bid is laughable, and, given the pre-market's reaction in the stock, investors seem to agree. The premium offered to shareholders is, in our opinion, completely inadequate and unacceptable...Typically, takeover premiums in this sector run between 30 percent and 50 percent. Based on the closing price of $81.82, this would place a takeover value on Genentech shares of between $106-$123."]

The drugmaker expects to shift its US pharma operations from Nutley, New Jersey, to Genentech’s site in South San Francisco, although separate sales organizations would remain intact. And Roche’s manufacturing in Nutley will be closed and support functions, such as informatics and finance, will be consolidated.

Genentech’s late-stage drug development and manufacturing operations will be combined with Roche. And Roche’s Palo Alto Virology R&D activities will relocate to South San Francisco, while its Palo Alto Inflammation group will become part of Roche’s Nutley R&D organization, where oncology, inflammation and metabolism research will be located.

If the deal is completed, the combined companies would have more than $15 billion in annual revenues and will employ around 17,500 pharma employees in the US, including a combined sales force of approximately 3,000 people. Including diagnostics, the Roche Group will employ around 25,000 people in the US.

Separately, Roche reported so-so earnings.