Habitrol business in US will be sold to Dr Reddy's Laboratories
The US Federal Trade Commission has approved GSK's purchase of the vaccines business of Novartis, excluding the influenza vaccines.
The deal is part of a three-way transaction unveiled in April, which includes GSK buying the vaccines business of Novartis, the Swiss pharmaceutical company purchasing GSK's cancer drugs, and the two groups combining their consumer healthcare businesses.
The FTC approved the consumer healthcare joint venture on the condition that Novartis sells Habitrol, its private-label nicotine replacement therapy (NRT) transdermal patch business in the US.
GSK said this business was already to be excluded from the proposed joint venture and the business would be sold to India-based Dr Reddy’s Laboratories, one of the largest sellers of private-label over-the-counter health products to the US market.
Novartis and GSK, which has the Nicoderm CQ patch, are two of only three companies that sell nicotine patches to US retailers, the FTC said.
The two companies each manufacture and market a range of consumer healthcare products in the US, including toothpaste, cold and flu remedies, indigestion remedies, skin care aids, and smoking cessation products.
Under the terms of the proposed joint venture agreement, GSK will control the joint venture and contribute, among other products, its nicotine patch business. Novartis will have a 36.5% interest in the joint venture, and without the divestiture required by the FTC, would continue to own the Habitrol business, which had US sales of more than US$58m in 2013.
The closing of the three-part transaction with Novartis remains subject to certain other conditions, including remaining antitrust clearances and GSK shareholder approval.
Subject to these conditions, the deal is expected to complete during the first half of 2015.