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FTC Challenges Barr’s Proposed Acquisition of Pliva
The Federal Trade Commission today announced its decision to challenge Barr Pharmaceutical, Inc.’s proposed acquisition of Pliva d.d for approximately $2.5 billion. The FTC’s complaint alleges that the acquisition as originally structured would have eliminated current or future competition between Barr and Pliva in certain markets for generic pharmaceuticals treating depression, high blood pressure and ruptured blood vessels, and in the market for organ preservation solutions, thereby increasing the likelihood that consumers would pay more for these vital products.
Required Divestitures in Generic Drug and Organ Preservation Solution Markets Protect Consumers and Competition.
The Federal Trade Commission today announced its decision to challenge Barr Pharmaceutical, Inc.’s proposed acquisition of Pliva d.d for approximately $2.5 billion. The FTC’s complaint alleges that the acquisition as originally structured would have eliminated current or future competition between Barr and Pliva in certain markets for generic pharmaceuticals treating depression, high blood pressure and ruptured blood vessels, and in the market for organ preservation solutions, thereby increasing the likelihood that consumers would pay more for these vital products.
In settling the Commission’s charges, Barr is required to sell its generic antidepressant trazodone and its generic blood pressure medication triamterene/HCTZ. Barr also is required to divest either Pliva’s or Barr’s generic nimodipine for use in treating ruptured blood vessels in the brain. Finally, Barr is required to divest Pliva’s branded organ preservation solution Custodial.
“Preserving competition in the markets for pharmaceuticals and other health care products to the benefit of U.S. consumers is core to the FTC’s mission,” said Jeffrey Schmidt, Director of the FTC’s Bureau of Competition. “The Commission’s action today furthers that mission by requiring divestitures that will prevent U.S. consumers from paying higher prices for these life-saving products after the proposed transaction.”
The Relevant Products and Markets: The Commission has identified four product markets that likely would experience anticompetitive effects if the proposed acquisition was allowed to proceed unchallenged.
Trazodone hydrochloride is an antidepressent sold in several different formulations. There are five suppliers of generic trazodone in the U.S., but not all the suppliers are capable of supplying all formulations. Barr and Pliva are two of only three suppliers of the 150 mg formulation of generic trazodone.
Triamterene/HCTZ is a combination product used to treat high blood pressure. Currently, there are only five suppliers of generic triamterene/HCTZ tablets in the U.S. and several of those suppliers, other than Barr and Pliva, have a more limited competitive presence.