£102.4m animal medicines firm acquisition cleared to go ahead

The UK’s Competition and Markets Authority (CMA) has cleared the intended acquisition by Dechra Pharmaceuticals of the Osurnia business of Elanco Animal Health Incorporated.

The $135m (£102.4m) deal was first reported early this year.

Dechra, a listed company which has its manufacturing base in Skipton, North Yorkshire, and its head office in Northwich, Cheshire, announced it had acquired the worldwide rights to the Osurnia product portfolio from Elanco.

Completion is expected before the end of July 2020.

Osurnia is a long acting treatment for otitis externa (inflammation of the outer ear) in dogs.

Dechra said it was acquiring the worldwide marketing rights; the rights to the intellectual property; the marketing authorisations and associated regulatory documentation; supply contracts with third-parties in relation to the raw material and manufacture of the finished product, and some existing inventory of the product.

On 26 March the CMA said it would investigate this transaction to see if it might “result in a substantial lessening of competition within any market or markets in the UK for goods or services.”

However, the authority has now concluded: “The Parties are not particularly close competitors in the supply of first-line antibiotic otitis treatments in the UK and there will remain sufficient competitors post-Merger to effectively constrain the Merged Entity.

“Accordingly, the CMA found that the Merger does not give rise to a realistic prospect of a Substantial Lessening of Competition (SLC) in relation to the supply of first-line antibiotic otitis treatments in the UK.

“The CMA also believes that the Merger would not reduce innovation in the supply of prescription non-antibiotic otitis treatments in the UK.”