Novartis cancels $1B sale of generics after antitrust concerns forced delays
Novartis has scrapped a generics sale that could have netted $1 billion after failing to obtain approval from the Federal Trade Commission on time.
CEO Vas Narasimhan first announced the deal to sell 300 products from Sandoz’ dermatology and oral solids portfolio in September 2018, a few months into his tenure. Part of his broader campaign to reshape the company into a more aggressive pharma player focused on new drugs and data science capabilities that can “reimagine medicine.”
India’s Aurobindo offered to pay $900 million upfront and another $100 million in milestones to bag not just the drugs but also manufacturing facilities in North Carolina and New York, as well as more than 750 employees. It would make Aurobindo the second largest generics player in the US just after Teva, the company told investors at the time.
According to Novartis’ full-year guidance for 2020, it had expected the deal to close in the first quarter — which is already later than it originally intended. Late last year, the FTC reportedly asked for more information from Aurobindo regarding an unspecified lawsuit.
Aurobindo is one of 20 drugmakers accused of concocting a giant price-fixing scheme, essentially forming the “largest cartel case in the history of the United States.”