CCI suggests changes to Sun Pharma-Ranbaxy deal to address anti-competitive concerns

The Competition Commission of India (CCI) has suggested Sun Pharmaceuticals and Ranbaxy Laboratories to make certain changes in their proposed US $4 billion merger deal, including possible divestment of some brands, to address anti-competitive concerns.

After a detailed scrutiny, CCI has finalised its view on the mega deal and the same has been conveyed to the concerned parties.

Sources said the regulator is now awaiting response from the parties on the suggested changes.

Among others, CCI is believed to have suggested divestment of some brands in order to comply with competition norms, the sources added.

Major issues examined by CCI on the deal are with respect to the molecules market.

The merger, which the fair trade regulator has prima-facie found to be in violation of competition norms, was inked in April 2014 and has been awaiting clearance from CCI since then.

The big-ticket deal in the pharma space is the first transaction that was subject to public scrutiny, which ended on September 24.

Sun Pharma-Ranbaxy transaction, which would create the country's largest pharmaceutical company, had come under close scrutiny of the competition watchdog after it was found prima-facie that the "combination is likely to have an appreciable adverse effect on competition".

The combined entity would have operations in 65 countries, 47 manufacturing facilities across 5 continents, and a significant platform of speciality and generic products marketed globally. The merger is also the first one where the commission sought public comments.