One of the world’s largest mergers in recent years will be approved by the EU, once the pharma companies involved find a new home for an IBD drug.
Two of the world’s largest pharma companies look set to become one after receiving approval from the European Commission (EC) for a merger between US-headquartered AbbVie and Dublin-headquartered Allergan.
The deal is valued at approximately $63bn, with the two companies combined employing almost 3,000 people in Ireland.
However, the EC has said approval is based on the condition that a product under development by Allergan for the treatment of inflammatory bowel diseases (IBD) is kept alive.
“IBDs are lifelong conditions with devastating effects on the life of millions of people,” said the commission’s executive vice-president and competition commissioner Margrethe Vestager.
“Our decision makes sure that the merger between AbbVie and Allergan will not disrupt the development of a promising innovative treatment for these diseases. This will increase the choice of treatments and offer better prices for patients.”
An investigation by the EC focused on an area where both companies overlapped – the production of drugs for IBDs such as ulcerative colitis and Crohn’s disease. AbbVie produces an IBD drug called risankizumab, while Allergan produces a drug called brazikumab. Both belong to a class of drugs called IL-23 inhibitors.
In its judgement, the commission noted that the drugs would be competitor products, with Allergan’s brazikumab likely to be shelved following the AbbVie takeover.
For the merger to proceed, AbbVie must allow for the manufacturing and marketing rights of brazikumab to be sold to another pharma company. Once the drug has been sold, the takeover and merger can be completed.
The deal was first announced in June of last year, with expectations that the companies combined would have sales of more than $48bn annually.
Allergan’s largest site globally is based in Westport, where much of the world’s Botox is produced, and it has three other facilities around the country. Abbvie, meanwhile, has three manufacturing sites in Ireland – located in Sligo and Cork – in addition to two offices in Dublin.