Novartis buy of Alcon moves forward, but USA and China competition authorities call for divestments

Swiss drug major Novartis will be required to sell an injectable eye care drug used in cataract surgery as part of a settlement which resolves US Federal Trade Commission charges that Novartis's proposed acquisition of eye-care specialist Alcon - which is also being fought by the latter's independent shareholders - would be anticompetitive (The Pharma Letters passim). Chinese competition regulators also require divestments in order to clear the deal.

Novartis and Alcon are the only two US providers of the class of drugs known as injectable miotics, and the FTC alleges that the acquisition would have created a monopoly in such products. The settlement requires Novartis to sell its drug Miochol-E to Bausch & Lomb, a competitor in the eye-care sector. The only two miotics products in the market are Miochol-E, owned by Novartis, and Miostat, owned by Alcon. US sales of injectable miotics totaled $12.4 million in 2009, and Novartis and Alcon have shares of 67% and 33%, respectively.

To preserve competition, the settlement requires Novartis to sell the rights and assets related to Miochol-E to B&L) within 10 days of when the acquisition is consummated. The FTC believes B&L, which is a major international eye-health company, is well-positioned to manufacture and market Miochol-E and compete effectively against Novartis.