Platinum Poppy C 2024 RSC Limited

Page 1 of 6 COMPETITION COMMISSION OF INDIA Combination Registration No. C-2024/05/1147 18th July 2024 Notice under Section 6(2) of the Competition Act, 2002 given by Platinum Poppy C 2024 RSC Limited CORAM: Ms. Ravneet Kaur Chairperson Mr. Anil Agrawal Member Mr. Deepak Anurag Member Order under Section 31(1) of the Competition Act, 2002 1. On 16th May 2024, the Competition Commission of India (‘Commission’) received a notice (‘Notice’) under sub-section (2) of Section 6 of the Competition Act, 2002 (‘Act’) given by Platinum Poppy C 2024 RSC Limited (‘Platinum Poppy’/ ‘Acquirer’). The Notice was filed pursuant to the execution of various documents including the Share Subscription Agreement between Platinum Poppy and Berhyanda Midco Limited (‘Berhyanda Midco’) and Share Subscription Agreement between Platinum Poppy and Berhyanda Limited (‘Berhyanda’), both dated 2nd March 2024 [Hereinafter, Berhyanda and Berhyanda MidCo are collectively referred to as the ‘Targets’, and Acquirer and Targets are collectively referred to as the ‘Parties’]. 2. The Proposed Combination envisages the acquisition of 21.76% ordinary shares of Berhyanda MidCo and 25% ordinary shares of Berhyanda by Platinum Poppy. Pursuant Combination Registration No. C-2024/05/1147 Page 2 of 6 to these acquisitions, Platinum Poppy will have an indirect non-voting economic interest in Suven Pharmaceuticals Limited (‘Suven’), as Berhyanda currently holds 50.1% of the shareholding in Suven. The Acquirer will also provide shareholder loans to both Berhyanda MidCo and Berhyanda by Platinum Poppy. 3. In terms of Regulation 14 of the Competition Commission of India (Procedure in regard to the transaction of business relating to combinations) Regulations, 2011, vide letter dated 3rd June 2024, certain information and clarifications were sought from the Acquirer. The Acquirer submitted the response dated 10th June 2024. Since the response was not complete, another letter dated 19th June 2024 was issued and the response dated 25th June 2024 was furnished by the Acquirer. The Acquirer also made voluntary submissions dated 20th June 2024. 4. Platinum Poppy is a restricted scope company incorporated in the Abu Dhabi Global Market (‘ADGM’) in 2024. It has been established solely for the purpose of investing in Berhyanda and Berhyanda MidCo. It does not directly carry out any business activities of its own, either worldwide or in India. Platinum Poppy is wholly-owned by Platinum Lily B 2024 RSC Limited (‘Platinum Lily’), which in turn is wholly-owned by Platinum International Investment Holdings RSC Limited (‘Platinum International’). Abu Dhabi Investment Authority (‘ADIA’) is the ultimate beneficiary of Platinum Poppy. ADIA is a public institution established by the Government of the Emirate of Abu Dhabi as an independent investment institution. 5. One of the ADIA’s portfolio companies in India is Intas Pharmaceuticals Ltd. (‘Intas’). Intas is engaged in the business of manufacture and sale of active pharmaceutical ingredients (‘APIs’) as well as development, manufacture and marketing of finished dosage formulations (‘FDFs’) across various therapeutic segments. 6. Berhyanda and Berhyanda MidCo are owned by funds managed by Advent International, L.P. (‘Advent’). Both these entities are investment holding companies. Berhyanda is the only investment held by Berhyanda MidCo and Suven is the only investment held by Berhyanda. Combination Registration No. C-2024/05/1147 Page 3 of 6 7. Suven is a public listed company incorporated in India in 2018 and listed on the BSE Limited and the National Stock Exchange Limited. Suven is a biopharmaceutical company and an integrated contract development and manufacturing (‘CDMO’). In India, it is engaged in the manufacture and sale of APIs and intermediates as well as the provision of CDMO for intermediates. 8. It is submitted in the Notice that prior to the Proposed Combination, Advent group merged three of its portfolio companies, namely ZCL Chemicals Limited (‘ZCL’), Cohance Lifesciences Limited (‘Cohance’) and Avra Laboratories Private Limited (‘Avra’) on 1st February 2024. Post this merger, Cohance became the resultant entity. It is also submitted that this merger is not interconnected to the Proposed Combination. 9. It is further submitted that Advent group is considering the merger of Cohance and Suven but has claimed that this transaction is not interconnected to the Proposed Combination and will not precede the Proposed Combination. In this regard, the Acquirer has considered Cohance (including ZCL and Avra) for the identification of overlaps. However, the Commission noted that the Parties are required to assess its notifiablity under the Act at the time of giving effect to this transaction. 10. Based on the Notice, the Parties (including their affiliates) are operating in the broad segments of: a. manufacturing and sale of various APIs in India and each API is considered to be distinct. b. manufacture and sale of various FDFs (including pellets) in India. FDFs are segmented based on the European Pharmaceutical Marketing Research Association’s anatomical therapeutic chemical (‘ATC’) classification, and ATC3 and ATC4 levels are considered. Additionally, molecular-level segmentation is also considered. c. provision of CDMO services in India, which can be narrowed down to segments of intermediates, APIs, and FDFs. Combination Registration No. C-2024/05/1147 Page 4 of 6 11. Based on the activities of the Parties (including their group entities/affiliates), it is submitted that Suven and Intas do not exhibit any horizontal overlaps. Further, certain APIs manufactured by Suven may be used as inputs to manufacture FDFs by Intas, thereby exhibiting the following potential vertical relationships: a. Iron Sucrose API (upstream) of Suven and iron preparations [ATC3 code – B3A] (downstream) of Intas; and b. Tamsulosin API (upstream) of Suven and drugs used in the treatment of benign prostatic hypertrophy (‘BPH’) [ATC3 code – G4C] (downstream) of Intas. 12. Further, based on the business activities of Cohance, it is submitted that Cohance and Intas exhibit horizontal overlaps in the manufacture and sale of the following FDFs: a. lipid-regulating cardiovascular multitherapy combination products [ATC3 code – C11A] and a narrower segment of lipid-regulating multitherapy fixed combination products (ATC4 code – C11A1) b. non-steroidal anti-rheumatics [ATC3 code – M1A] and narrower segment of anti- rheumatics (non-steroidal combination) (ATC4 code – M1A2) c. anti-depressants and mood stabilisers [ATC3 code – N6A] and narrower segment of SNRI antidepressants (ATC4 code – N6A5) d. lipid regulators in combination with other lipid regulators [ATC3 code – C10C] e. systemic agents for fungal infections [ATC3 code – J2A] f. plain antispasmodics and anticholinergics [ATC3 code – A3A] g. antiobesity preparations (excluding dietetics) [ATC3 code – A8A] and h. drugs used in the treatment of BPH [ATC3 code – G4C] and narrower segment of BPH alpha antagonists and 5 ARIs, combinations (ATC4 code – G4C4). 13. In terms of vertical overlaps, Cohance and Intas exhibit the following linkages: a. Existing vertical overlap: certain APIs [Drotaverine, Entacapone, Fluvoxamine Maleate, Lamotrigine, Methyl Phenidate, and Tamsulosin] manufactured by Cohance are used as input in the FDFs manufactured by Intas. b. Potential vertical relationships: certain APIs [Apixaban, Aripiprazole, Atomoxetine, Baclofen, Betahistine, Clozapine, Dapagliflozin Propanediol Monohydrate - G, Dipyridamole, Lenalidomide, Levocetrizine, Lurasidone Combination Registration No. C-2024/05/1147 Page 5 of 6 Hydrochloride, Mebeverine, Memantine, Quetiapine Fumarate, Zonisamide] manufactured by Cohance can potentially be used as input in the FDFs manufactured by Intas. c. Potential vertical relationship: provision of CDMO services for FDFs by Cohance (upstream) and manufacture/ sale of FDFs by Intas (downstream). 14. The Commission decided to leave the delineation of the relevant market open, as it was observed that the Proposed Combination is not likely to cause appreciable adverse effect on competition in any of the plausible relevant market(s) in India. 15. Based on the submissions of the Acquirer, the Commission observed that the market share of Suven in upstream markets of Iron Sucrose API and Tamsulosin API is insignificant. Thus, there is no likely foreclosure concern due to these linkages. 16. With respect to horizontal overlaps between Cohance and Intas, the Commission noted that the incremental market share of the parties is in the range of [0-5]% for all overlapping FDF segments/sub-segments. 17. With respect to vertical overlaps, existing and potential, between Cohance and Intas, the Commission noted that these linkages are not likely to raise any foreclosure concerns. 18. Considering the material on record, including the details provided in the Notice and the assessment of the Proposed Combination based on the factors stated in Section 20(4) of the Act, the Commission is of the opinion that the Proposed Combination is not likely to have appreciable adverse effect on competition in India. Therefore, the Commission approves the Proposed Combination under Section 31(1) of the Act. 19. This order may be revoked if, at any time, the information provided by the Acquirer is found to be incorrect. 20. The information provided by the Acquirer shall be treated as confidential in terms of and subject to provisions of Section 57 of the Act.