FTC Approves Final Order Preserving Competition in the Market for Nicotine Patches

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Following a public comment period, the Federal Trade Commission has approved a final order settling charges that global pharmaceutical company Novartis AG’s consumer health care products joint venture with GlaxoSmithKline would likely be anticompetitive.

Under the order, first announced in November 2014, Novartis agreed to divest Habitrol, its branded nicotine replacement therapy patch, as well as its private-label patch business. According to the complaint, Novartis and GSK are the only companies that market branded nicotine patches in the United States, and two of only three companies that supply private label patches to retailers. Without the divestiture, Novartis’s ownership of both Habitrol and a substantial interest in the joint venture that sells GSK’s nicotine patches would have substantially reduced competition and led to higher prices for Habitrol and Novartis’s private-label patches.

The Commission vote approving the final order was 5-0. (FTC File No. 141 0141; the staff contact is Mark Silvia, Bureau of Competition, 202-326-3291)

The FTC’s Bureau of Competition works with the Bureau of Economics to investigate alleged anticompetitive business practices and, when appropriate, recommends that the Commission take law enforcement action. To inform the Bureau about particular business practices, call 202-326-3300, send an e-mail to antitrust@ftc.gov, or write to the Office of Policy and Coordination, Bureau of Competition, Federal Trade Commission, 600 Pennsylvania Ave., NW, Room CC-5422, Washington, DC 20580. To learn more about the Bureau of Competition, read Competition Counts. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.

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