Merck & Co., Inc. and Schering-Plough Corporation have announced that they have received clearance from the US Federal Trade Commission (FTC), the Swiss Competition Commission and the Canadian Competition Bureau for their proposed merger.
Merck reports that the companies said that the FTC terminated the waiting period under the Hart-Scott-Rodino Improvements Act of 1976, as amended, and cleared the pending merger. The companies also stated that the Canadian Competition Bureau terminated the waiting period under the Canadian Competition Act and cleared the proposed transaction.
Richard T. Clark, chairman, president and chief executive officer of Merck, said: "Clearances from the FTC, the Swiss Competition Commission and the Canadian Competition Bureau mark significant steps in the completion of our merger with Schering-Plough. As we work with regulators on the remaining approvals necessary for the close, we stand ready to serve patient needs as a new global healthcare leader."
The transaction remains subject to approval from other regulators, including China and Mexico. Merck and Schering-Plough continue to expect the transaction to close in the fourth quarter of 2009.
Both companies required to divest
According to Law.com, the FTC required both companies to make significant divestures.
Under the terms of the FTC's consent order, Merck must sell its interest in Merial Limited, an animal health joint venture with Sanofi-Aventis, and Schering Plough must sell its assets related to drugs that treat nausea and vomiting in humans.
The animal health joint venture, Merial, generated global revenues of $2.6 billion in 2008, according to the FTC. Merck will sell its interest to Sanofi-Aventis. The FTC was concerned that the combined companies would dominate the market for poultry vaccines – Merial and Schering-Plough together account for about 75 per cent of US sales of such vaccines. The two companies are also leaders in medication treating cattle follicular cysts.
The deal also raised concerns related to human drugs.
"The Commission analyzed the likely impact of this proposed transaction and is confident that its order will ensure continued competition in the relevant human and animal health care markets," said Bureau of Competition Director Richard Feinstein in a statement reported by Law.com.