FTC dismisses suit against Omnicare
The Federal Trade Commission has dismissed its lawsuit against Omnicare after the long-term care pharmacy provider dropped its hostile bid to take over rival PharMerica.
The FTC had filed a lawsuit in January to block the purchase of PharMerica by Omnicare, claiming that the combination of the country's top two long-term care pharmacy providers would diminish competition and potentially increase the cost of drug prices to those in skilled nursing facilities.
[See also: FTC opposes OmniCare's proposed takeover of PharMerica.]
Omnicare announced Tuesday that it was letting its tender offer to purchase for $15 per share all outstanding shares of PharMerica common stock expire.
"While we continue to strongly disagree with the FTC's decision to seek to block the proposed transaction, we do not believe it is prudent to invest significant time and money in a lawsuit at this time," Omnicare said in a statement released Tuesday. "After careful consideration, including the rejection of our offers to resolve the alleged concerns through a consent agreement that encompassed divestitures, and a review of Omnicare's many other compelling growth opportunities, we have concluded that it is in the best interests of Omnicare shareholders, customers and employees to allow the tender offer to expire."
"We are pleased with Omnicare's decision to allow its tender offer to expire," said Gregory S. Weishar, PharMerica's CEO, in a statement. "The PharMerica Board of Directors was unanimous in its belief that Omnicare's offer substantially undervalued PharMerica and was illusory due to the significant antitrust concerns."
The FTC voted 4 to 0 to dismiss its complaint after learning Omnicare was abandoning its pursuit of PharMerica.
"We're gratified that Omnicare has abandoned its efforts to acquire PharMerica," said FTC chairman Jon Leibowitz in a statement released Thursday. "As we said last month when we filed our complaint, this deal would have harmed an especially vulnerable group of patients – those in long-term care facilities – as well as taxpayers, who foot much of the bill under Medicare, by raising the price of drugs for Medicare Part D consumers and others."
Follow HFN associate editor Stephanie Bouchard on Twitter @SBouchardHFN.
