Tag Archives: DoJ HSR Comments Second Request Bayer Behringer Merial Intervet Pfizer Wyeth Animal Health FTC Hart Scott Divestitures Overlap Sanofi ECC Antitrust Reverse Merger August 21 2009

It Seems the Pfizer/Wyeth Challenge Is an Antitrust Case, Primarily. . . .

Over the weekend, I reported on a Bloomberg story — one about which I expressed some skepticism. The story had it that some California pharmacies were in federal court, last Friday, filing a suit, to block the Pfizer/Wyeth merger — on what looked to be novel grounds. The supposed grounds were misuse of TARP funds, by Pfizer’s banks — including the same banks financing the Merck deal.

While the language summarized by Bloomberg does actually appear in the suit, this one is much more an ordinary, plain-vanilla Clayton Act and Sherman Act type of claim — than a “you can’t use TARP money that way” suit:

. . . .the conduct of the defendants and the banks financing the defendants’ merger. . . constitutes a combination and conspiracy that unreasonably restrains trade in the relevant markets. . . in the form of higher prices, diminished choice and lower quality of drugs. . . . [which conduct] violates Section 7 of the Clayton Antitrust Act, and Section 1 of the Sherman Act . . .

Interestingly though, the suit does mention the Merck/Schering-Plough deal, as being potentially anticompetitive (click to enlarge):

I guess I’d still say this has only a small chance of derailing either of these mega-mergers — even if someone were, for argument’s sake, to file a companion claim against Merck, and its banks, back here on the East Coast. I’ll keep an eye on it, just the same. Here is the full California pharmacies’ complaint, in a PDF file format.

Italy’s Dog/Cat Ear Infection Anti-Microbials Market: Highly-Concentrated

More, shortly (other duties call — but I wanted to get this cute puppy graphic right out!); this is the third in the series — Schering-Plough / Intervet / Merial-Sanofi/ “New Merck” would have 55 percent to 60 percent of the companion animal ear infection antimicrobials market in Italy — and face only one serious competitor — Janssen.

This is one more thing to write about, when you get ready to write the European Competition Commission.

You only have six days left to respond — now that Sanofi-Aventis is acquiring the second half of Merck’s Merial animal health venture, and is also being granted the right to buy all of Intervet, post the Schering-Merck merger. [Here are the earlier parts one, and parts two.]

Back in the Fall of 2007, as a part of Schering-Plough’s original acquisition of Organon (and Intervet), the ECC required divestitures of a slew of animal health product lines. While it is exceedingly difficult to track which concerns bought which product lines, post 2007 (out of the Organon/Intervet acquisition required divestitures), what is clear is that if Merial and Intervet are combined, even in a 50-50 joint venture between Sanofi-Aventis and “New Merck” — there will be significant, and increased, concentration in many animal health markets in Europe.

[Recall again that Sanofi-Aventis is buying Merial, from Merck, and then receiving a “call” option — to buy all of Intervet, post the Schering-Plough/Merck merger.] With me so far? Good.:

. . . .The parties have a combined market share of [55-60]% (Schering-Plough: [10-20]%; Intervet: [10-20]%; Merial: [20-30]%), in Italy. The new entity would face only two competitors, only one of them having solid market share: Janssen: [30-40]. . . .

So, this is yet a[nother] public service mailer — print, or cut and paste the above, and mail in the next ten days — if you are at all concerned about preserving European price- and product-offering competition in animal health businesses. Mail it (Old School-style) to this address:

European Commission
Directorate-General for Competition
Merger Registry
1049 Bruxelles/Brussel

Whiskey for my men; beer for my horses. . . .”