Novartis to Divest Nicotine Patch Habitrol to Comply with FTC

By Angela Chen 

Novartis AG will divest its nicotine replacement patch Habitrol, as mandated by the Federal Trade Commission, to go ahead with its consumer-health merger with GlaxoSmithKline.

As Novartis and GlaxoSmithKline are the only companies that market nicotine patches in the U.S., the FTC said the proposed joint venture would be anticompetitive and make it difficult for other companies to develop new patches.

Habitrol had U.S. sales of more than $58 million in 2013.

London-based GlaxoSmithKline and Swiss Novartis both manufacture consumer health-care products, including skin-care aids, cold-and-flu remedies, toothpaste and indigestion remedies.

The companies in April unveiled a set of complicated deals worth more than $20 billion that would create a new over-the-counter consumer-health business. The company, with sales of $11 billion, would be called GSK Consumer Healthcare. GlaxoSmithKline will control the business, with a 63.5% stake and seven of 11 board directors, and contribute its nicotine patch, Nicoderm CQ.

Write to Angela Chen at [e-mail]

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