CADE approves, with restrictions, joint venture between GSK and Novartis
The Administrative Council for Economic Defense – CADE approved the creation of a joint venture between GlaxoSmithKline PLC. - GSK - and Novartis AG (merger file no. 08700.008607/2014-66) conditioned to the signature of a Merger Control Agreement (ACC for its acronym in Portuguese). With the transaction, GSK will own 63,5% and Novartis 35,5% of the joint venture’s shares.
The global partnership between the companies is being developed to trade consumer products for healthcare exempt from medical prescription, also known as over the counter products.
According to Reporting Commissioner Márcio de Oliveira Júnior, it was verified that the merger could raise a high concentration in the antismoking drugs.
To mitigate possible competition concerns, the companies and CADE signed an agreement in which GSK commits to divest a package of assets related to its main antismoking product. This product is sold in the country in tablets and patches forms. The package of assets to be divested includes tangible and intangible assets, such as intellectual property rights, licenses and contracts. Furthermore, the parties commit to adopt various measures to guarantee that undue information exchanges between the joint venture and Novartis will not happen.