The $16.5 billion acquisition of Catalent by Novo Holdings is facing yet another delay as the Federal Trade Commission (FTC) is seeking more information about the deal. Originally planned to close by the year’s end, the repeated delays might push this timeline into next year. The acquisition was announced in February of this year.
Located in New Jersey, Catalent is one of the largest contract development manufacturing organizations in the life sciences field. As a part of the deal, Novo Nordisk is set to pay Novo Holdings $11 billion to acquire three manufacturing sites of Catalent that specialize in the filling of vials for sterile injectable drugs. These manufacturing sites, located in Belgium, Italy, and Indiana, will significantly increase Novo Nordisk’s production capacity.
It is not the first time Novo Holdings had to face delays concerning its acquisition of Catalent. FTC’s review process has also had a hiccup a month ago when Novo Holdings had to withdraw and refile its application for the deal’s approval following informal discussions with FTC staff. This move resulted in a 30-day extension to the FTC’s antitrust review.
And then, in a new development last week, the FTC requested additional documents and information from Novo Holdings and Catalent, triggering another month-long extension to the agency’s review. Despite this, Novo Nordisk and Catalent are confident that the deal will still close by the anticipated date, according to their securities filing.
The proposed acquisition has sparked commentary from various corners, the most notable being Eli Lilly, a major competitor of Novo Nordisk in the GLP-1 drug space. Following the announcement of the proposed deal, Eli Lilly CEO David Ricks questioned the acquisition citing concerns about increasing scrutiny for the pharmaceutical industry mergers by antitrust authorities.
Despite all challenges, Novo Nordisk maintains that it will honor all prior customer obligations of the three facilities it plans to acquire. While delays persist, it is clear to all involved that the FTC’s consultation is crucial to the acquisition’s successful implementation.