The Israel-based Teva Pharmaceuticals look to be on the verge of sealing the biggest pharma deal of the year to date by launching an unsolicited $40bn (£27bn) bid to buy nearest rival Mylan.

Teva is the largest generic drugmaker in the world.

The deal would underscore the frenzied pace of mergers and acquisitions in the pharmaceutical industry - the total value of healthcare deals in the first quarter of 2015 reached $95.3bn, a massive 70% increase on the same period a year ago, according to data from Thomson Reuters.

Some of the top investors at Mylan, including Paulson & Co, are encouraging its board of directors to consider a takeover proposal from rival Teva Pharmaceutical Industries, according to Reuters, citing people familiar with the matter.

Reuters said a handful of these investors have expressed their support in recent weeks for the creation of the world's largest generic drug maker by sales, quoting sources who declined to be named because they were not authorised to speak to the media.

Pressure has been growing on Jerusalem-based Teva for new revenue sources, said Reuters. Its biggest selling drug, multiple sclerosis injectable treatment Copaxone, faces competition from oral treatments and cheaper generics in the coming years.

In March, Teva said it would acquire neurology company Auspex Pharmaceuticals for $3.5bn to boost its portfolio of treatments for the central nervous system.

A Teva-Mylan deal would be the second-largest healthcare transaction in the past 12 months, following generic drugmaker Actavis's $66bn purchase of Botox maker Allergan.