EU: Commission OKs Teva $40.5 billion acquisition of Allergan Generics

The European Commission has approved Teva Pharmaceutical Industries Ltd.’s $40.5 billion acquisition of Allergan plc’s global generics business on condition that Teva divest several assets, including the majority of Allergan Generics’ business in the United Kingdom and Ireland.

The commission had been concerned that the merged company would have a negative impact on the overall generics business in the U.K., Ireland and Iceland, leaving insufficient competition for a number of generic pharmaceuticals. Those concerns were addressed in commitments offered by the companies, according to the EU.

In order to address those concerns, Teva agreed to divest of certain overlapping molecules in 24 European countries, other than the United Kingdom, Ireland and Iceland.

In the United Kingdom and Ireland, Teva will divest of a majority of the current Allergan Generic business and the divested unit will be capable of manufacturing and marketing generic medicines. The remainder of the Allergan Generics U.K. and Ireland business will be integrated into Teva’s operations.

In Iceland, Teva will divest of its generic business, while retaining the Allergan Generics business.

“Effective competition between generic pharmaceutical manufacturers is essential to drive down prices for patients and healthcare systems,” Margrethe Vestager, EU commissioner in charge of competition policy, said. “I am glad we have found a solution that allows this takeover to proceed, while ensuring that competition will continue in all European countries.”

Meanwhile, Teva announced it continues to work closely with the FTC to obtain the necessary regulatory approval in the U.S., where concerns also had been raised that a shrinking generic market could cause prices to rise.

Full content: The New York Times

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