By Peter Reap, J.D., LL.M.
Conditioned upon the divestment of several of Mylan’s generic medicine businesses in 20 countries throughout the EEA and the UK.
The European Commission (EC) has approved, under the EU Merger Regulation, the proposed merger between Mylan, a global pharmaceutical company, and Upjohn, a business division of Pfizer, which operates Pfizer's off-patent branded and generic established medicines. Mylan is one of the top five generic suppliers in the European Economic Area (EEA). The approval is conditioned on the divestment of Mylan's business for certain generic medicines across 20 countries across the EEA and the UK, according to the announcement.
According to EC Executive Vice-President Margrethe Vestager, responsible for competition policy: "Ensuring that patients and hospitals have access to medicines at fair and competitive prices, as well as ensuring security of supply, is always a key priority which resonates even more strongly in the current challenging context. Our decision ensures that the merger between Mylan and Upjohn does not harm competition, thus preserving competitive access to certain genericised medicines for national health services and European citizens."
The EC’s investigation. The EC's investigation found that no competition concerns arise for the majority of the products supplied by both Mylan and Upjohn. However, in some countries and for some molecules, the EC found the transaction would raise competition concerns because of the strong position of the two companies and the limited number of significant competitors on the market. In particular, concerns were found for 36 molecule-country pairs. For example, competition concerns were raised for (1) Alprazolam in Greece, Iceland, Ireland, Italy, and Portugal; (2) Atorvastatin in Norway; and (3) Doxazosin in Czechia and France.
The Commission also investigated the vertical relationships between Mylan and Upjohn with respect to (1) active pharmaceutical ingredients and (2) out-licensing which are both upstream to the supply of genericised medicines. The EC concluded that no competition concerns arise in this regard.
Divestitures. To address these concerns, Mylan and Upjohn offered to divest to one or more suitable purchasers, Mylan's business in the relevant markets, including the applicable marketing authorizations, contracts and brands, as well as transitory manufacturing and supply arrangements. These include certain generic medicines across 20 countries throughout the EEA and the UK.
The proposed commitments remove the entire overlaps between Mylan and Upjohn in the markets raising serious doubts and fully address all of the competition concerns. The merger, as modified by the commitments, would no longer raise competition concerns in the EEA. Approval is conditional upon full compliance with the commitments, the EC said.
Companies: Mylan N.V.; Pfizer Inc.
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