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Lupin and Gavis to divest generics to appease US FTC Posted 25/03/2016

Lupin Pharmaceuticals (Lupin) and Gavis Pharmaceuticals (Gavis) have reportedly agreed to sell two generics in order to finalize Lupin’s acquisition of Gavis.

The US$850 million acquisition of US generics maker Gavis by Indian generics manufacturer Lupin was announced in July 2015 [1]. However, the US Federal Trade Commission (FTC) has claimed that the acquisition of Gavis would likely be anticompetitive, unless the companies sell the rights and assets for two generics.

The two drugs involved are doxycycline monohydrate capsules, a treatment for bacterial infections and mesalamine extended release capsules, which is used to treat ulcerative colitis.

According to the FTC, the merger would have combined two of only four companies that currently market generic doxycycline monohydrate capsules in two dosage strengths, likely resulting in higher prices. Similarly, the FTC found that the merger would also have eliminated one of only a few companies likely to enter the market for generic mesalamine extended release capsules in the near future, thereby delaying beneficial competition and the prospect of price decreases.

The companies have therefore agreed to sell rights and assets for the two generics to New Jersey-based G&W Laboratories (G&W). The FTC order requires Lupin to transfer all of Gavis’ rights and assets related to generic doxycycline monohydrate capsules to G&W no later than 10 days after the acquisition is finalized, so that G&W can begin selling the product immediately. Lupin is also required to supply G&W with the finished product for two years.

The proposed order also requires that Gavis divest its rights and assets related to generic mesalamine capsules to G&W before the acquisition takes place.

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Source: FTC

1. GaBI Online - Generics and Biosimilars Initiative. Lupin to expand US generics business with Gavis acquisition [www.gabionline.net]. Mol, Belgium: Pro Pharma Communications International; [cited 2016 Feb 25]. Available from: www.gabionline.net/Pharma-News/Lupin-to-expand-US-generics-business-with-Gavis-acquisition

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