Dr Reddy's closes acquisition of Habitrol brand

Company will market the product in the US market

Dr Reddy’s Laboratories has closed the acquisition of Habitrol brand, an over-the-counter nicotine replacement therapy transdermal patch, from Novartis Consumer Health Inc, following the issuance of the consent order from the US Federal Trade Commission (FTC) last month.  

The company had earlier entered into an asset purchase agreement with Novartis to acquire the title and rights of Habitrol brand and to market the product in the US, the company said in a press release. The company will begin the shipments of the product in the market shortly, it said. In October, the company has agreed to acquire this brand for an undisclosed sum.

Habitrol has US sales of more than $ 58 million, according to the earlier reports.

Dr Reddy’s agreed to buy Habitrol following the decision to divest the brand by Novartis as mandated under the competition laws. In April 2014,Novartis and GlaxoSmithKline had decided to merge their global consumer healthcare business.

Citing the fact that Novartis and GlaxoSmithKline are the only companies that have been marketing the nicotine patch product in the US, the FTC maintained the merger of their consumer healthcare business would make it difficult for other companies to bring new products of similar nature into the market.

Dr Reddy’s scrip ended the trade at Rs 3,191.05 on the BSE on Friday, up 1.29 per cent, over the previous close of Rs 3,150.50 a share.