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FTC Seeks Extra Data on the $16.5B Novo-Catalent Deal, Resulting in One other Delay

Novo Holdings’ deliberate acquisition of Catalent is dealing with one other delay. Simply weeks after Novo Holdings determined to resubmit its utility to the Federal Commerce Fee, the company is looking for extra details about the deal.

The transaction was initially anticipated to shut by the tip of this yr, however this timeline will not be as strong given the repeated delays within the FTC’s assessment course of.

The acquisition was introduced in early February when Novo Holdings — the funding arm of the inspiration that owns a controlling stake in Danish pharma big Novo Nordisk — disclosed its plans to amass New Jersey-based contract improvement manufacturing group Catalent for $16.5 billion. 

Catalent is without doubt one of the largest CDMOs within the life sciences area. It reported $4.2 billion in web income for the fiscal yr that ended June 30, 2023.

Ought to the deal shut, Novo Nordisk pays Novo Holdings $11 billion to purchase three of Catalent’s manufacturing websites specializing in the filling of vials for sterile injectable medication. The websites are situated in Belgium, Italy and Indiana. 

These websites have already got ongoing relationships with Novo Nordisk as a part of the drugmaker’s world manufacturing infrastructure for its GLP-1 agonist medication. Demand for Ozempic and Wegovy — two GLP-1 medication made by Novo Nordisk — continues to be hovering, and buying these websites would considerably increase the drugmaker’s manufacturing capability.

“We’re more than happy with the settlement to amass the three Catalent manufacturing websites which is able to allow us to serve considerably extra individuals dwelling with diabetes and weight problems sooner or later,” Novo Nordisk CEO Lars Fruergaard Jørgensen stated in a February press launch.

The primary delay within the FTC’s assessment course of for this deal got here a month in the past when Novo Holdings withdrew and refiled its utility for the deal’s approval after having “casual discussions with FTC workers.” This was achieved to “give the FTC extra time to assessment the transactions,” in accordance with the refiling. The resubmission triggered a 30-day extension to the FTC’s antitrust assessment.

After which final week, the FTC requested extra paperwork and data from Catalent and Novo Holdings — a transfer that triggered one more 30-day extension to the company’s assessment.

Each Novo Holdings and Catelent are gathering extra data to provide the FTC “as expeditiously as potential,” in accordance with a securities submitting from Catalent. 

Eli Lilly is probably the most outstanding voice questioning the proposed acquisition, which comes as no shock contemplating the drugmaker is Novo Nordisk’s chief competitor within the GLP-1 house. Eli Lilly’s Mounjaro and Zepbound are direct opponents to Novo Nordisk’s Ozempic and Wegovy. 

Equally to Novo Nordisk, Eli Lilly has additionally been having bother maintaining with the skyrocketing demand for GLP-1 drugs. In November, the drugmaker introduced it was planning a brand new $2.5 billion manufacturing website in Germany to assist it meet the growing demand for its injectable diabetes and weight problems medication.

Simply days after Novo Nordisk introduced its plans to amass Catalent, Eli Lilly CEO David Ricks instructed the Monetary Occasions that he discovered the deal “uncommon” given antitrust authorities’ growing scrutiny for mergers within the biopharma house.

Additionally simply days after the deal was introduced, Eli Lilly CFO Anat Ashkenazi expressed concern about how the acquisition would influence his firm’s excellent contracts with Catalent.

“Catalent is an integral half or producer of each business and pipeline merchandise for the business, particularly in diabetes and weight problems, and we have now merchandise with these websites as properly,” he stated on an earnings name. “So, our focus immediately is on making certain that continuity of provide of drugs for sufferers is uninterrupted, in addition to we intend on holding Catalent accountable to their contract with us.”

Novo Nordisk has stated that it’s going to honor all prior buyer obligations of the three amenities it’s planning to amass. The drugmaker didn’t reply to MedCity Information’ request for added commentary.

In a press release despatched to MedCity Information, a Catalent spokesperson stated they’re “assured within the many advantages of the transaction” and nonetheless anticipate the deal to shut earlier than the tip of the yr.

Photograph: illustration, Getty Photos

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