European Commission Approves GSK's Acquisition of Pfizer Consumer Healthcare Business with Divestment Condition
GSK
Pharmaceutical R&D Manufacturer
Pfizer
Pharmaceutical R&D Developer
European Commission
The European Commission, abbreviated as the EU Commission, is a supranational body under the European Union. Within the EU political system, the European Commission primarily undertakes executive tasks, thus being roughly equivalent to the government in a national system. However, the European Commission has other functions as well. In particular, except for the few circumstances specified in the treaties, the European Commission is the only institution with legislative power in the EU legislative process.
The European Commission recently announced that, under the EU Merger Regulation, it has approved GlaxoSmithKline’s (GSK) acquisition of Pfizer’s consumer health business, subject to Pfizer’s divestiture worldwide of its local pain management products under the ThermaCare brand.
According to the investigation, the European Commission is concerned that both companies are suppliers of products for local pain management, and the acquisition will reduce competition among such products, leading to price increases in some countries within the European Economic Area, including Austria, Germany, Ireland, Italy, and the Netherlands.
To address this issue, the European Union proposed that Pfizer divest this business globally, with the assets subject to approval by the European Commission and sold as a whole to a suitable buyer.
On December 19 last year, Pfizer and GlaxoSmithKline separately announced that they had reached an agreement to merge their consumer healthcare businesses. The new entity will operate globally under the name GSK Consumer Healthcare, meaning Pfizer’s Health Drugs Division will be integrated into GlaxoSmithKline’s Consumer Healthcare division.
On the 11th of last month, the organizational structure of the new company formed by the merger of GSK Consumer Healthcare and Pfizer’s Consumer Healthcare Business was announced. In this structure, Cai Baoguang, former President of Pfizer Asia Pacific, continues to oversee the Asia-Pacific region, while Gu Haiying, former General Manager of Pfizer’s Consumer Healthcare Business in China, has been appointed as the General Manager for Greater China at the new company.