Novartis and Aurobindo Pharma Terminated their $1 billion Transaction

| By | Generics, Novartis, Sandoz
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Novartis announced the mutual agreement with Aurobindo Pharma USA Inc. to terminate the agreement to sell the Sandoz US generic oral solids and dermatology businesses to Aurobindo Pharma USA Inc. This decision was taken as approval from the U.S. Federal Trade Commission for the transaction was not obtained within anticipated timelines.

Antitrust review has nixed a $1 billion transaction that would have created the second-largest U.S. generics player.

Sandoz will continue to operate its oral solids and dermatology business as part of the Sandoz US business.

The deal was signed in September 2018 as part of Novartis CEO Vas Narasimhan’s plan to focus the Swiss pharma more on innovative medicines. Shedding U.S. oral generics looked like a wise step as pricing pressure mounted across the U.S. sector and dragged down Sandoz’s overall performance.

For Aurobindo, buying about 300 products would have made it the second-largest generics company in the U.S. by prescriptions and helped the Indian pharma expand its global business further.

Originally, Novartis was expecting to close the deal in 2019, but U.S. antitrust review caused significant delays. The Economic Times previously reported that regulators had requested more information on a lawsuit against Aurobindo, a development that pushed the planned closure into 2020.

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