Canadian and Australian Regulatory Authorities OK Pfizer’s $17 Bn Acquisition of Hospira
Pfizer has received additional regulatory clearance for its pending $17 billion acquisition of Hospira. Pfizer was granted approval from the Canadian Competition Bureau for the pending acquisition, subject to certain divestments, and also received approval from the Australian Competition and Consumer Commission with no requests for divestments.
To address competition concerns in respect of the supply of four pharmaceutical products, the Canadian Competition Bureau reached an agreement with Pfizer under which Pfizer will sell its Canadian assets related to its marketed injectable cytarabine products (used to treat various types of blood cancers), injectable epirubicin products (used to treat a variety of cancerous tumor types), and oral tablet methotrexate products (used to treat certain cancers as well as severe psoriasis and arthritis), as well as Hospira's pipeline injectable voriconazole product (used to treat serious, invasive fungal infections).
Approval from the regulatory authorities of Canada and Australia follows approval by the European Commission (EC) earlier this month, which approved Pfizer’s acquisition of Hospira pending certain divestments. The EC approval is conditional on Pfizer divesting certain sterile injectable drugs as well as its infliximab biosimilar drug, which is currently under development. Infliximab is the active ingredient in Johnson & Johnson’s Remicade, a drug used o treat autoimmune diseases such as rheumatoid arthritis and Crohn’s disease. In its ruling, the EC noted that one biosimilar has been approved for use in the European Economic Area (EEA) (developed by Celltrion but co-marketed by Hospira and Celltrion), and that two companies have biosimilars in advanced stages of development (Samsung Bioepis and Pfizer). The EC said it had competition concerns for infliximab drugs because following the merger with Hospira, Pfizer would be likely to either: delay or discontinue development of its biosimilar drug in order to focus on Hospira’s marketed product, leading to the net loss of future competition by one of only three differentiated biosimilars in advanced stages of development (Hospira/Celltrion’s, Samsung Bioepis’ and Pfizer’s) or hand back Hospira’s product to its developer Celltrion, leading to the loss of current price competition between Hospira and Celltrion.
The EC also noted competition concerns for sterile injectables for certain products in some European Union member states: namely carboplatin in Belgium; cytarabine in Belgium, Italy, Portugal, and Sweden; epirubicin in Austria, Belgium, Italy, the Netherlands, and Spain; irinotecan in Belgium, the Czech Republic, and Italy; vancomycin in Ireland and voriconazole in the EEA as a whole).
To address these competition concerns, Pfizer submitted a set of commitments and following a review and has agreed to the following: (1) full divestment of the development, manufacturing and marketing rights of its infliximab biosimilar drug currently under development (including appropriate intellectual property, technology and know-how), with marketing rights outside the EEA remaining with the merging entity and (2) divestment of marketing authorizations and associated rights of Pfizer or Hospira in relation to certain sterile injectables relevant in specified EU countries.
Pfizer expects the deal to close in the second half of 2015. Completion of the transaction remains subject US regulatory review (i.e., the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976). governmental and regulatory approvals in certain other jurisdictions. and other usual and customary closing conditions.