In a major development for the country’s pharma sector, the Competition Commission of Pakistan (CCP) has authorised the acquisition of Novartis Pharma (Pakistan) Limited (Novartis Pakistan) by International Investment II Limited (IIL), the commission said on Saturday.
The approval comes after the CCP completed its phase-I competition assessment under Section 11 of the Competition Act, 2010, and the Competition (Merger Control) Regulations, 2016, read a statement.
IIL, an investment holding company incorporated in Hong Kong and part of the Getz Group, submitted a pre-merger application to the CCP. The transaction involves the transfer of control of Novartis Pakistan from its existing parent entities, Novartis AG and Novartis Pharma AG, to IIL pursuant to a Share Purchase Agreement (SPA).
Meanwhile, Novartis Pakistan is a leading pharmaceutical company engaged in the manufacture, import, marketing, and distribution of medicines across a wide range of therapeutic classes.
“The acquisition represents a significant development in Pakistan’s pharmaceutical sector, as IIL already maintains a presence in the country through its subsidiaries, Getz Pharma (Private) Limited and Scilife Pharma (Private) Limited,” CCP said.
During the phase-I review, the commission examined whether the transaction could result in the creation or strengthening of a dominant position or otherwise substantially lessen competition in the relevant markets. The CCP defined the relevant markets at the therapeutic class level, given the lack of substitutability across medical categories.
The commission observed that while certain overlaps existed between Novartis Pakistan and IIL in therapeutic classes, such as diabetes, anti-rheumatics, anti-epileptics, and cardiovascular agents, the combined market shares were “not significant enough” to raise competition concerns.
Based on its assessment, the CCP concluded that the transaction “neither creates nor strengthens a dominant position in any relevant market and is unlikely to substantially lower competition in Pakistan”. Consequently, the acquisition was authorised under Section 31(1)(d)(i) of the Competition Act, 2010.