Novo’s $16.5bn Catalent deal cleared by EU Commission
Novo Holdings’ $16.5 billion takeover of US contract development and manufacturing organisation (CDMO) Catalent does not create competition issues and can go ahead, according to the European Commission.
Novo Holdings – the parent company of Danish pharma group Novo Nordisk – said that it now expects the takeover to finalise before the end of the year. Catalent stockholders voted to approve it in May.
The transaction – first announced in February – would see Novo Nordisk subsequently pay $11 billion to take control of three of Catalent’s fill-and-finish facilities, which would allow it to ramp up production capacity for key medicines, including drugs for diabetes and obesity.
“The proposed merger would not raise competition concerns on any of the markets examined in the EEA (European Economic Area) or on any substantial part of it,” the European Commission said in a statement.
Its investigation – which focused on the markets for the supply of pre-filled syringes used in Novo Nordisk’s Ozempic for diabetes and obesity therapy Wegovy (both based on GLP-1 receptor agonist semaglutide), as well as for orally-disintegrating tablets – concluded that there would be plenty of access to other credible CDMOs if the transaction goes through.
The three companies involved in the transactions still need to get clearance from the US Federal Trade Commission (FTC) to safely proceed, with a decision expected in the coming weeks.
In October, US Senator Elizabeth Warren asked the FTC to look closely at the deal, saying she was concerned that it could give Novo Nordisk increased dominance in the market for GLP-1 receptor agonists, leading to reduced competition and increased prices for patients.
Novo Nordisk’s arch-rival in the sector, Eli Lilly, has also been vocal about its concerns regarding the deal, saying that Catalent’s customer base includes dozens of companies that “plan to compete in some way with Novo Nordisk.”
Lilly’s diabetes therapy Mounjaro and Zepbound for obesity – based on dual GIP/GLP-1 receptor agonist tirzepatide, which bested semaglutide in a head-to-head trial – are not produced by Catalent.
Earlier this year, Novo Holdings withdrew and then refiled paperwork related to the transaction with the FTC, which sought more time to review it.
Calatent said that it was pleased to have received European Commission approval, calling it a “significant milestone.” President and chief executive Alessandro Maselli said: “There is tremendous positive momentum underway at Catalent, and I believe that our future is even brighter as a private company with the support of Novo Holdings.”
