News

US FTC Scrutinizes AbbVie/Allergan Deal

04.10.2019 -

The US Federal Trade Commission (FTC) has requested additional information from both Allergan and AbbVie as it digs deeper into the proposed merger of the two drugmakers.

Biopharma AbbVie offered in June to buy troubled Botox manufacturer Allergen in a cash-and-share deal worth $63 billion.

The FTC’s second request has come as consumer groups and unions have petitioned the watchdog, voicing their concern that the deal would create the world’s fourth-largest drugmaker with leading positions in treatment areas such as cancer drugs, eye care and medical esthetics, particularly at a time when the high cost of medicines has become a major political issue.

According to a Reuters report last month, Consumer Action and others, working with the Service Employees International Union (SEIU) and American Federation of State, County & Municipal Employees (AFSCME), have written to the FTC asking it to carefully examine the takeover and even consider blocking it.

AbbVie has previously stated that it did not expect any problems with receiving FTC approval, apart from “a few small product overlaps that we’ve agreed to divest promptly.” Allergan has also volunteered to sell two drugs – brazikumab and Zenpep, both treatments for inflammatory bowel disease.

The companies said they are cooperating fully with the FTC and continue to expect to close the transaction early next year. The deal still needs the approval of Allergan shareholders and the company has scheduled two special shareholder meetings on Oct. 14 to seek their OK.

The takeover by Roche of Sparks Therapeutics has also been held up by the FTC, which issued a second request for information in June. The UK’s Competition and Markets Authority is also investing the pending acquisition and has asked for more time.

The offer for Spark’s shares will now expire on Oct. 30. As of Sep. 27, only 21.4% of Spark’s shares had been tendered.