US pharmaceutical giant Pfizer is nearing a deal to merge its off-patent drugs business with generic drugmaker Mylan, The Wall Street Journal reported Saturday.

They could announce the proposed merger as early as Monday, which the Journal said. It would create a new global giant in the sector of lower-priced medicines.

It comes as drugmakers face intense political pressure to drive down prices in the United States, and as former big sellers including Pfizer’s impotence drug Viagra and cholesterol pills Lipitor, have lost patent protection and face lower-priced competition.

Both groups reportedly hope a merger with Mylan — whose top seller the EpiPen emergency allergy shot is also facing new competition — will help reignite slowing sales growth.

If the operation goes ahead, Mylan shareholders will own just over 40 per cent of the new entity, and Pfizer shareholders the remainder, the Journal said.

With a market value just under $10 billion, Mylan reported annual turnover last year of close to $12 billion.