When Novo Nordisk’s holding firm introduced plans to accumulate contract producer Catalent for $16.5 billion in February, the deal confronted swift public backlash and an inquiry from the Federal Commerce Fee. Because the 12 months winds down, the deal’s potential affect remains to be up within the air, and Massive Pharma rivals have joined the refrain of opposition.
The deal would assist the Danish drugmaker safe manufacturing capabilities for its fashionable weight reduction and diabetes medication Ozempic and Wegovy. Novo has struggled to maintain up with demand for the merchandise, touchdown Wegovy on the FDA’s scarcity checklist.
The pharma already works with Catalent, and in reference to the acquisition plans to accumulate three fill-finish Catalent websites for $11 billion from dad or mum firm Novo Holdings to fabricate GLP-1 medication.
Novo’s plans encountered antitrust issues from lawmakers, shopper teams and different Massive Pharma firms alike because the weight reduction drug market grows towards an estimated $100 billion or $200 billion by 2030. As one of many largest contract manufacturing organizations within the business, Catalent additionally works with Eli Lilly, the opposite main pharma firm within the present GLP-1 panorama.
Simply this month, Senator Elizabeth Warren (D-Mass.) requested FTC Chair Lina Khan to “carefully scrutinize” the proposed deal, noting that Novo has a 55% market share for GLP-1 medication. A pack of shopper teams and unions additionally joined collectively to ask the FTC this month to halt the acquisition on the grounds it might be “dangerous” to competitors within the weight reduction business and affect gene therapies.
Now, with different drugmakers seeking to enter the weight problems market, Novo’s acquisition efforts are additionally coming beneath hearth from a possible competitor.
Roche’s market curiosity
Roche is the most recent to pile on to the deal’s opposition, calling on authorities to dam the acquisition. The Swiss drugmaker is at present advancing a pipeline of three weight problems and diabetes medication it picked up in a $2.7 billion takeover of Carmot Therapeutics.
“Limiting the competitors on this area is not a good suggestion,” Roche’s CEO Thomas Schinecker instructed media retailers final week. “From an business perspective, it might be a improper determination by authorities.”
In keeping with Schinecker, Roche has the manufacturing capability it wants for its weight problems and sort 2 diabetes GLP-1 drugs beneath growth. Nonetheless, he voiced concern for smaller pharmas that will lose entry to contract manufacturing organizations via market consolidation.
Roche’s weight reduction and diabetes meds may rival Novo’s down the road, though they’re nonetheless in early phases of growth. The pharma large expects section 1 knowledge from one diabetes and weight problems therapy, the GLP-1/GIP CT-388, in late 2024 with plans to current the information in 2025.
Roche can also be specializing in section 2 knowledge for an additional GLP-1/GIP candidate, CT-868, for sort 1 diabetes sufferers, and extra section 1 knowledge for CT-996, a kind 2 diabetes therapy, in 2025, Schinecker stated in the course of the earnings name.
Lilly’s half
Eli Lilly, Novo’s present rival within the GLP-1 market, has its personal issues concerning the merger. Lilly makes use of Catalent to fabricate GLP-1 medication, Zepbound and Mounjaro, CEO David Ricks stated in the course of the firm’s second quarter earnings name in August.
“We do depend on one of many Catalent websites for GLP-1 and different diabetes manufacturing,” Ricks stated. “It is extra the oddity of your most important competitor being additionally your contract producer and learn how to resolve that state of affairs.”
Nonetheless, Lilly has been build up its manufacturing capability, pouring $9 billion into an Indiana facility in Might to spice up manufacturing of the lively elements in its GLP-1 injections and different medicines. The corporate has dedicated $18 billion towards its manufacturing prowess since 2020.
However Novo Holdings maintains Catalent isn’t a serious contractor for Lilly.
“Catalent has no position within the business manufacturing of Eli Lilly’s Zepbound and Mounjaro merchandise,” the corporate said on its web site concerning the deal.
The place the deal stands
At present, Novo Holdings’ proposed deal is beneath assessment by the FTC, which requested for further data associated to the acquisition in Might. The merger was initially anticipated to shut towards the top of 2024, in line with Catalent.
The FTC has elevated scrutiny of enormous offers in pharma and different industries as of late, and Novo and Catalent could have to make concessions earlier than carrying via with the merger.
As opposition to the deal has crescendoed, Catalent has tried to quell market issues. CEO and president Alessandro Maselli launched a press release final week in an try and dispel “inaccuracies” surrounding the deal. Particularly, Maselli said the CDMO would proceed to companion with pharma firms to convey merchandise via growth and medical trials, in addition to proceed its fill providers. Catalent shareholders have already accredited the deal, which might take the corporate personal as proposed.
