The European Commission has given its approval for the acquisition of Allergan Generics by Israeli pharmaceutical firm Teva, subject to certain conditions.
The Commission has asked the companies to divest certain assets as it is concerned that the proposed $40.5bn deal would reduce competition in the generic pharmaceuticals market.
The companies have decided to divest marketed molecules and molecules in development pipeline giving rise to competition concerns in 24 European Economic Area (EEA) countries.
Teva would divest its portfolio of marketed molecules and molecules in development pipeline in Iceland.
Allergan Generics’ marketed generics activities and generics activities in development pipeline in Ireland and the UK would also be offloaded, in addition to its manufacturing plant in Barnstaple, UK, where most of the generics it sells in Ireland and the UK are manufactured.
Commissioner Margrethe Vestager said: "Effective competition between generic pharmaceutical manufacturers is essential to drive down prices for patients and healthcare systems.
"I am glad we have found a solution that allows this takeover to proceed, while ensuring that competition will continue in all European countries."
As per the agreed terms, Teva will acquire Allergan’s Actavis global generics business that include the US and international generic commercial units and third-party supplier Medis.
The acquisition will also include global generic manufacturing operations, global generic R&D unit, international over-the-counter (OTC) commercial unit, (excluding OTC eye care products) and some established international brands.
Upon completion of the deal, the acquired business is expected to transform Teva’s global generics space through expanding its generics pipeline, R&D capabilities, operational network, supply chain, global commercial deployment and infrastructure.
Image: Teva has agreed to purchase generic drug unit from Allergan in July last year. Photo: courtesy of Piyachok Thawornmat / FreeDigitalPhotos.net.