The Commerce Commission today cleared the New Zealand arm of the international merger of pharmaceutical companies Glaxo Wellcome Plc and SmithKline Beecham Plc, subject to the divestment of some assets to an independent third party.

Commission Chair John Belgrave said that the Commission was satisfied that, subject to the divestment undertaking, the proposed merger would not result in any party acquiring or strengthening a dominant position in any New Zealand market.

In this case, the relevant markets are those for the wholesale distribution of:

  • topical anti-viral products for the treatment of cold sores, and
  • diuretic products.

The applicants have agreed to sell to a third party, all of their rights in New Zealand and globally, for the cold sore product which is marketed under the brand name "Vectavir".

The Commerce Act prohibits business acquisitions that result in dominance being acquired or strengthened in any market.

Parties can apply for a clearance, which the Commission will grant if it is satisfied that dominance is not acquired or strengthened.

A clearance, if granted, protects an acquisition from court action under the Act.

Media contact: Commerce Act Manager Geoff Thorn, Phone work (04) 498 0958

Senior Advisor Communications: Vincent Cholewa, Phone work (04) 498 0920