Antitrust Law Daily Wrap Up, ACQUISITIONS & MERGERS NEWS: FTC conditions Hikma’s proposed acquisition of Roxane on divesture of certain generic drugs, (Feb 26, 2016)
Organizations Mentioned:Hikma Pharmaceuticals PLC | Roxane Laboratories Inc. | Roxane Laboratories, Inc.
By Michael Menzhuber, J.D., LL.M.
In order to settle FTC charges that Hikma Pharmaceuticals PLC’s proposed $2 billion acquisition of Roxane Laboratories would likely be anticompetitive, Hikma will sell the rights and assets for two generic drugs and relinquish its U.S. marketing rights to a third generic drug, the agency announced today.
The proposed consent order preserves competition by requiring Hikma to divest the following to Pennsylvania-based Renaissance Pharm, Inc.: (1) three strengths of anti-inflammatory and immunosuppressant prednisone tablets; and (2) all strengths of lithium carbonate capsules, used to treat bipolar disorder. The order also requires Hikma to relinquish its rights to market flecainide acetate tablets in the U.S. to its drug development partner, India-based Unimark Remedies, Ltd.
Without the divesture, the merger would have combined two of the five firms marketing prednisone tablets and two of the four firms marketing lithium carbonate capsules. Roxane is currently only of only two firms with a significant market share in flecainide tablets and, absent the merger, Hikma was expected to market these tablets in the U.S. following FDA approval, which is currently being sought by Unimark.
The terms of the proposed order require Hikma to:
transfer to Renaissance, no later than the earlier of ten days after the acquisition is consummated or the proposed order becomes final, all of its interests related to 5mg, 10mg, and 20mg generic prednisone tablets and all strengths of lithium carbonate capsules, including inventory, manufacturing capacity, and research and development rights;
continue supplying both products to Renaissance during a transition period while the latter establishes independent manufacturing capabilities; and
with respect to flecainide, divest its 23 percent ownership interest in Unimark so that Unimark will be an independent maker of the drug.
The FTC will publish the consent package in the Federal Register shortly. The agreement will be subject to public comment through March 29, after which a decision will be made on whether to make the proposed consent order final. Comments can be filed electronically or in paper form by following the instructions in the “Supplementary Information” section of the Federal Register notice.
Companies: Hikma Pharmaceuticals PLC; Roxane Laboratories Inc.
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