FTC OK for Pfizer/Warner-Lambert merger, but with demands for divestitures

The US Federal Trade Commission has approved the $110 billion stock-swapmerger of Pfizer and Warner-Lambert, which creates a $300 million drugs giant after the firms agreed to the four divestitures demanded of them. Richard Parker, director of the FTC's bureau of competition, said that the Commission's order "preserves competition for several very important drugs that treat diseases suffered by millions of Americans annually - head lice in children, depression, Alzheimer's and cancer." The FTC voted five to zero to approve the deal.

Alzheimer's "literal monopoly" stopped

Pfizer's RID head-lice treatment is to be sold to Bayer as the newly-merged entity would have had a 60% share of the $150 million lice treatments market. The FTC also noted that Pfizer and W-L currently market the only two drugs in the USA for the treatment of Alzheimer's disease, with the former's Aricept (donepezil) dominating the industry with a 98% share (and first-quarter 2000 sales of $138 million). W-L's Cognex (tacrine) makes up the remaining 2%, so in order to prevent Pfizer gaining "a literal monopoly" in the Alzheimer's market, it is being sold to First Horizon.