Sun Pharma buyout of Ranbaxy gets conditional US nod

The US Federal Trade Commission on Friday imposed conditions on India's Sun Pharmaceutical Industries Ltd's proposed acquisition of fellow-Indian generic drug maker Ranbaxy Laboratories Ltd.

Fearing that the $4-billion deal would be anti-competitive, the FTC has stipulated that Sun sell its interest in a generic anti-bacterial medicine, which Sun has reportedly agreed to do.

The FTC said pharmaceutical companies Sun Pharmaceutical Industries and Ranbaxy Laboratories have agreed to divest the latter's interests in generic minocycline tablets in order to settle charges that Sun's proposed acquisition of Ranbaxy would likely be anti-competitive.

Torrent Pharmaceuticals, a global drug company based in India that markets generic drugs in the US, will acquire the divested assets, the FTC said.

Generic minocycline tablets are used to treat an array of bacterial infections, including pneumonia, acne, and urinary tract infections.

Sun Pharmaceutical said in April that it had agreed to buy the Indian generic drugmaker from its current owner, Japan's Daiichi Sankyo Co.

Ranbaxy has been involved in a wrangle with the US Food and Drug Administration, which has barred a range of its medicines manufactured in India from the United States after finding that the company's plants did not meet US standards.

The FTC, whose job is to ensure that anti-monopoly laws are enforced, did not weigh in on the safety issue.

Ranbaxy is one of three companies to sell the anti-bacterial drug, and Sun is expected to begin selling the medicines soon, the FTC said in a statement.

The FTC has appointed an interim monitor to ensure that Torrent receives the support it needs from Sun and Ranbaxy during the divestiture process.