Sun Pharma-Ranbaxy announced it's landmark USD 4 billion merger deal in April. Since then the two entities have been working to receive regulatory clearance, especially from competition authorities. Last week, CCI gave the deal a conditional approval and now the deal is close to getting approval from the US competition authority as well.
As a result of its post merger consultation with the US Federal Trade Commission (FTC), the Sun-Ranbaxy combine will most probably have to sell just one drug for the merger to get the green light.
Initially it was thought to have been 2-3 drugs, but now it is learnt to be two dosage forms of one drug. Sale talks are in advanced stages and it is expected that once sold, the merger will get FTC approval.
Though no clarity has emerged on what this drug this might be, sources say the revenue impact will be negligible in comparison to the size of the merged entity. Sun Pharma says: "The process of receiving clearance from the US FTC is ongoing, it is difficult to give any specifics as well as the time for clearance."
Is final clearance still some time away?
As for progress on the seven drugs identified for sale by the CCI, inquiries have come in but Sun and Ranbaxy are awaiting the appointment of a monitoring agency by CCI as laid out in its order, before proceeding to sell the products. CCI's order says 'the Commission shall appoint an independent agency as monitoring agency for the purpose of supervision of the modification.' The modification being the sale of seven drugs. As per the CCI order, Sun-Ranbaxy have 10 months to complete the divestments.
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