Synthes acquisition by Johnson & Johnson delayed as EU Commission starts in-depth investigation

The planned $21.3 billion acquisition of orthopedic device maker Synthes (SYST: VX), which is listed in Switzerland but operates out of the USA, by US health care giant Johnson & Johnson (NYSE: JNJ) is likely to face antitrust delays in Europe (The Pharma Letter April 27), as the European Commission announced last Friday that it has opened an in-depth investigation under the European Union Merger Regulation into the deal.

The decision to open an in-depth inquiry does not prejudge the final result of the investigation. The Commission now has 90 working days, until March 19, 2012, to take a final decision on whether the transaction would reduce effective competition in the European Economic Area (EEA).

Commission Vice President in charge of competition policy Joaquin Almunia said: “The proposed acquisition would remove a competitor from some markets which are already concentrated. The Commission needs to make sure that effective competition is preserved, in order to maintain innovation and prevent harm to patients."