The Federal Trade Commission has asked for an additional 30 days for its review of Novo Nordisk’s $16.5 billion acquisition of Catalent, with the companies expecting to complete the merger by the end of 2024.
The Novo Nordisk Foundation’s $16.5 billion acquisition of contract manufacturer Catalent has hit another potential regulatory bump in the road after the U.S. Federal Trade Commission last week requested additional information regarding the deal.
Revealed in a Friday SEC filing from the contract manufacturer, the delay comes as the FTC ramps up its antitrust scrutiny of the buyout—and will extend the acquisition’s waiting period by up to 30 days as Novo and Catalent comply with the regulator’s request.
The companies “intend to cooperate” and are currently “in the process of gathering information and documentary materials” to submit to the FTC, according to Catalent’s SEC filing. The companies expect to complete the merger toward the end of the year.
Novo Nordisk Foundation first announced the $16.5 billion, all-cash deal in February 2024. The acquisition centers on three fill-finish sites, which would help the Foundation’s pharmaceutical arm cope with the market’s insatiable demand for its weight-loss and diabetes treatments.
However, following “informal discussions” with the FTC, the Novo Nordisk Foundation last month withdrew and subsequently refiled its antitrust submissions. This move gave the FTC an additional 30 days to review the transaction.
The delays also come as the FTC and Department of Justice reassess their policies on mergers and acquisitions. In a draft document released in July 2023, the agencies laid out 13 governing guidelines they intend to use to determine whether a proposed buyout is anticompetitive or not. Among other factors, these guidelines would consider the concentration of markets, the risk of coordination between entities and the deal’s potential effects on entrants into the field.
Novo’s proposed acquisition of Catalent has sparked several competitive concerns throughout the industry. In its fourth-quarter and full-year 2023 earnings call, Eli Lilly questioned the effects of the merger on its outstanding contracts with Catalent.
CFO Anat Ashkenazi at the time said that Catalent plays an “integral” role in the manufacturing of Lilly’s products and that the company intends to hold Catalent “accountable to their contract with us.”
The merger has also raised antitrust questions in the EU, with the European Medicines Agency (EMA) in February 2024 launching its own investigation into the deal’s possible effects on drug supply. The EMA did not name which specific drugs will be part of its investigation but has said that it will work with member states to determine sites affected by the merger and identify potential points of shortage.
Tristan Manalac is an independent science writer based in Metro Manila, Philippines. Reach out to him on LinkedIn or email him at tristan@tristanmanalac.com or tristan.manalac@biospace.com.
