As the clock ticks down on 2024, Novo Holdings’ proposed $16.5 billion buyout of CDMO giant Catalent—which the companies have said they expect to close before year-end—just received a major vote of confidence from antitrust officials overseas.
Friday, Catalent and Novo Holdings—a holding company distinct from the Danish drugmaker Novo Nordisk—said the European Commission (EC) has granted “unconditional approval” to the companies’ pending transaction.
While industry watchers and rival drugmakers alike have raised their eyebrows about the potential competitive implications of the deal, the EC said in a release that its investigation concluded the proposed merger “would not raise competition concerns.”
Customers who require contract manufacturing help with prefilled syringes will still be able to tap into multiple credible CDMOs such as Thermo Fisher Scientific, Vetter and Pfizer’s CentreOne, the EC explained.
Likewise, drugmakers that need an assist on production of orally disintegrating tablets will have “sufficient alternatives” to Catalent as well as the potential to switch between contract manufacturers, according to the bloc’s antitrust officials.
With Europe’s blessing, Novo Holdings and Catalent now need to get a thumbs-up from the U.S. Federal Trade Commission (FTC) for their deal to pass muster. The FTC is expected to issue a decision on the transaction in the next several weeks.
Novo Holdings, which operates alongside Novo Nordisk under their parent company the Novo Nordisk Foundation, unveiled plans to purchase Catalent for $16.5 billion in February. The deal looks set to be the largest biopharma M&A transaction of 2024 barring any major year-end moves.
After the buyout closes, Novo Nordisk is slated to purchase a trio of Catalent fill-finish sites from Novo Holdings for $11 billion. Novo Nordisk has been working to extensively scale up manufacturing capacity to help meet demand for its GLP-1 agonists for diabetes and obesity, Ozempic and Wegovy.
Given the high profiles of the companies involved in the potential merger, several other pharma outfits have spoken out against the deal.
Shortly after the buyout’s reveal, Eli Lilly’s former chief financial officer, Anat Ashkenazi, said Lilly had been left with “questions about the transaction,” adding that the company intended on holding Catalent accountable to its contracts.
More recently, Roche’s chief executive, Thomas Schinecker, side-eyed the deal, arguing that “limiting competition in this space is not a good idea.”
The CEO clarified that Catalent’s acquisition wouldn’t weigh heavily on Roche’s own production operations, but he argued the deal “could be a problem for other smaller players if there is a restriction in terms of how many CMOs are available.”
Elsewhere, consumer groups and lawmakers like Sen. Elizabeth Warren, D-Massachusetts, have called on the FTC to carefully scrutinize Novo Holdings and Catalent’s plan.
As for FTC developments in the U.S., Novo Holdings’ parent, the Novo Nordisk Foundation, in April pulled its paperwork with the agency to resubmit its application and give the FTC additional time to review the deal.
The following month, the FTC asked for additional documents and information from Novo and Catalent as part of what’s known as a “second request.”
Both companies said they would work to appease the FTC’s request “as expeditiously as possible.” Novo and Catalent have both continued to stress that they expect the deal to close before the end of 2024.
By Fraiser Kansteiner
Source: fiercepharma.com
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