The European Commission approved on on July 17 the proposed merger of Pfizer and Wyeth, subject to Pfizer renouncing some of its animal health products in Europe.
Pfizer, already the world's biggest pharmaceutical firm, announced the planned merger in January, seeking diversification as it prepares for the expiration of patents on its blockbuster drugs.
The $68 billion deal appears to be the biggest takeover in the global pharmaceutical sector since Pfizer acquired Warner-Lambert Co. for $93.4 billion in 2000, financial analysts say.
The EU's executive branch -- which enforces EU competition law -- said the merger is conditional on "Pfizer's commitment to divest several types of animal health vaccines, pharmaceuticals and medicinal feed additives" in Europe.
"The commission had concerns that the transaction, as originally notified, would have raised competition issues in the field of animal health products on a number of national markets," it said. "In the light of the commitments offered by Pfizer, the Commission has now concluded that the proposed transaction would not significantly impede effective competition in the EEA or any substantial part of it."
The European Economic Area (EEA) includes the 27 EU member states plus Iceland, Liechtenstein and Norway.
In addition, the European Commission said Pfizer -- best known for the anti-cholesterol treatment Lipitor and erectile dysfunction drug Viagra, as well as AIDS drugs -- has offered to "divest" a Wyeth plant in Sligo, Ireland. Wyeth, based in Madison, N.J. and formerly known as American Home Products, makes such popular non-prescription brands as the painkiller Advil, Robitussin cough medicine and, for haemmorroids, Preparation H.
The merger still awaits a green light from competition authorities in the U.S., China and other jurisdictions, as well as approval from Wyeth shareholders.
If the deal goes ahead, the combined company will be number one in terms of biopharmaceutical revenues in the U.S. with a market share of about 12%. It will hold about 10% of the market in Europe.
Financial analysts say Pfizer, with headquarters in Brooklyn, N.Y., is aiming to widen its revenue stream as some of its key drugs face competition from generic manufacturers.
Copyright Agence France-Presse, 2009