PCC deepens review of GSK-Pfizer deal

MANILA, Philippines — The Philippine Competition Commission (PCC) has started a more detailed inquiry into the proposed acquisition by GlaxoSmithKline Consumer Healthcare Holdings Ltd. (GSK) of Pfizer Inc.’s global consumer healthcare business to determine if the deal would lead to reduced competition in pharmaceutical drug markets.

In a statement yesterday, the antitrust body said it has launched the second phase review on the proposed transaction of GSK and Pfizer.

“The commencement of Phase II review of the transaction does not mean that MAO (Mergers and Acquisitions Office) has made a definitive finding of a substantial lessening of competition or has prejudged the result of the review. This only signifies that a more detailed analysis of the transaction is required using additional information from the parties, other market participants and third parties,” the PCC said.

Under the proposed transaction, GSK would be taking over Pfizer’s global consumer healthcare business, which mainly involves over-the-counter drugs.

The proposed transfer of business will cover the sale of shares of Pfizer subsidiaries engaged solely in consumer healthcare and sale of assets of Pfizer entities which carry out the consumer healthcare business.

For the transaction, GlaxoSmithKline Plc. will issue non-controlling shares representing 32 percent ownership interest in GSK Consumer Healthcare to Pfizer.

PCC’s 30-day preliminary review on the proposed transaction ended last April 22.

The second phase review would cover a period of 60 calendar days and look at whether the transaction would result in substantial lessening of competition in pediatric and adult antitussives and expectorants; pediatric analgesics; and nutritive health or multivitamins.

PCC’s second phase review will focus on the two firms’ overlapping products.

For instance, GSK produces Sinecod, Calpol and Scott’s, whose counterparts in Pfizer are Robitussin, Advil and Clusivol.

GSK is engaged in developing, manufacturing, and marketing prescription, vaccine and consumer healthcare products.

In the Philippines, it is present through Duncan Pharmaceuticals Philippines Inc. and GlaxoSmithKline Philippines Inc., which are both responsible for its prescription and vaccine products, as well as through Duncan Consumer Healthcare Philippines Inc. and GlaxoSmithKline Consumer Healthcare Philippines Inc. for the consumer healthcare business, and SmithKline Beecham Research Ltd. for both prescription and consumer healthcare activities.

Meanwhile, Pfizer is involved in the pharmaceutical business and produces medicines for ailments including cardiovascular health, metabolism, oncology, inflammation and immunology.

It conducts its consumer healthcare business in the country through Pfizer Inc. (Philippines).

The PCC conducts a review of mergers and acquisitions to ensure such would not lessen competition in the market and harm consumer interest.