For Your Information : April 8, 1997
The Federal Trade Commission today announced the following action:
Consent agreements given final approval: Following a public comment period, the Commission has made final a consent agreement with the following entity. The Commission action makes the consent order binding on the respondent.
- The consent order with Ciba-Geigy Limited, of Basel, Switzerland,Ciba-Geigy Corporation, of Tarrytown, New York, Sandoz Ltd., of Basel, Switzerland, Sandoz Corporation, of New York City, Chiron Corporation, of Emeryville, California, and Novartis AG, of Basel Switzerland, settles charges that the merger of Ciba and Sandoz, both pharmaceutical and chemical giants, could slow development or increase prices for gene therapy products, which are expected to begin offering significant improvements in the treatment of cancer and other diseases and medical conditions; and that it also could substantially reduce competition and raise prices in the U.S. market for herbicides used in corn production and the U.S. market for pet flea-control products. The consent order requires the licensing of specified gene therapy technology and patent rights to Rhone- Poulenc Rorer, Inc., of Collegeville, Pennsylvania, to put Rhone-Poulenc in a position to compete against the combined firm. It also requires divestiture of the Sandoz U.S. and Canadian corn herbicide assets to BASF, a German firm, and its flea control business to Central Garden & Pet Company, of Lafayette, California, or another Commission- approved buyer. (See Dec. 17, 1996 news release for further details about this case; Docket No. C-3725; Commission vote on March 24 to issue the consent order as final and binding was 5-0, with Commissioner Mary L. Azcuenaga dissenting from the order in the gene therapy markets and issuing a statement to which the rest of the Commission responded. Azcuenaga said in her statement that the Commission should have required divestiture of either the Ciga-Geigy or Sandoz gene therapy business, rather than licensing, stating that divestiture "would preserve the competition in research and development that existed before the merger, without compulsory licensing under order, without the mandating by the Commission of ?reasonable’ fees, and without creating possible disincentives for innovative research." Chairman Robert Pitofsky and Com missioners Janet D. Steiger, Roscoe B. Starek, III, and Christine A. Varney responded in their joint statement that "patent licensing not only alleviated the competitive problems but also avoided divestiture’s potentially disruptive effects on the parties’ ongoing research.") Staff contact is William Baer, 202-326-2932, or Howard Morse, 202-326- 2949.
Copies of the final order, the Commissioners’ full statements, and other documents associated with this case are available on the FTC’s web site at www.ftc.gov and also from the FTC’s Public Reference Branch, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-326-2222; TTY for the hearing impaired 1-866-653-4261. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326- 2710.
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