By Angela Chen
Novartis AG will divest its nicotine replacement patch Habitrol,
as mandated by the Federal Trade Commission, to go ahead with its
consumer-health merger with GlaxoSmithKline.
As Novartis and GlaxoSmithKline are the only companies that
market nicotine patches in the U.S., the FTC said the proposed
joint venture would be anticompetitive and make it difficult for
other companies to develop new patches.
Habitrol had U.S. sales of more than $58 million in 2013.
London-based GlaxoSmithKline and Swiss Novartis both manufacture
consumer health-care products, including skin-care aids,
cold-and-flu remedies, toothpaste and indigestion remedies.
The companies in April unveiled a set of complicated deals worth
more than $20 billion that would create a new over-the-counter
consumer-health business. The company, with sales of $11 billion,
would be called GSK Consumer Healthcare. GlaxoSmithKline will
control the business, with a 63.5% stake and seven of 11 board
directors, and contribute its nicotine patch, Nicoderm CQ.
Write to Angela Chen at angela.chen@dowjones.com
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