The Korea Fair Trade Commission (KFTC) has halted Boryung's acquisition of Sanofi's cancer drug Taxotere, citing significant concerns over reduced market competition.
On June 4, the KFTC announced that it had reviewed Boryung's plan to acquire the marketing rights for Taxotere, an original cancer drug containing docetaxel, from Sanofi. The commission determined that the merger would substantially limit competition and ordered Boryung to divest the Taxotere business to a third party.
Docetaxel is widely used for breast cancer treatment, with market shares in South Korea showing Sanofi at 64.7%, Boryung at 13.8%, and Dong-A ST at 6.9%. Boryung had signed a contract last October to acquire all necessary rights for Taxotere's domestic and international sales from Sanofi and subsequently reported the merger to the KFTC.
The KFTC expressed concerns that the merger would lead to monopolistic practices. With Boryung holding a 13.8% market share as the second-largest player and Sanofi holding 64.7% as the market leader, the combined entity would control 78.5% of the market, creating an overwhelming dominant position.
There were also worries that the merger could lead to a decline in product quality or reduce competitive incentives. Boryung has been the only company in South Korea to develop and supply an alcohol-free docetaxel product, competing on quality with the leading product. However, concerns arose that acquiring the leading product could diminish Boryung's motivation to maintain quality competition.
As a result, the KFTC conditionally approved the merger, mandating Boryung to sell the Taxotere business. Specifically, Boryung must divest its Taxotere-related assets to a third-party pharmaceutical company within six months to ensure a sufficient number of effective competitors in the market.
Additionally, to prevent any weakening of Taxotere's competitive capabilities, Boryung is prohibited from ceasing production and supply of Taxotere or encouraging a shift to Taxotere sales until the divestiture is complete.
After the sale, Boryung will be required to supply finished Taxotere products and provide technical support to the acquiring company for a specified period upon request.
A KFTC official stated, "This merger will help secure a stable supply of essential medicines for treating breast cancer and other conditions by enabling the domestic manufacturing and sale of the original docetaxel cancer drug. We will closely monitor anti-competitive mergers to actively prevent monopolistic practices and consumer harm."
* This article has been translated by AI.
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