Torrent Pharmaceuticals Limited

Document text

Page 1 of 33 COMPETITION COMMISSION OF INDIA Combination Registration No. C-2025/07/1299 Non-Confidential 21st October 2025 Notice under Section 6(2) of the Competition Act, 2002 given by Torrent Pharmaceuticals Limited CORAM: Ms. Ravneet Kaur Chairperson Ms. Sweta Kakkad Member Mr. Deepak Anurag Member Order under Section 31(1) of the Competition Act, 2002 I. Background 1. On 16th July 2025, the Competition Commission of India (Commission) received a Notice under Section 6(2) of the Competition Act, 2002 (Act), given by Torrent Pharmaceuticals Limited (Acquirer/Torrent) in relation to proposed acquisition of shareholding in J. B. Chemicals & Pharmaceuticals Limited (JB/Target) [hereinafter, the Acquirer and the Target are collectively referred to as the ‘Parties’], as detailed below: (i) Tau Share Purchase: Pursuant to the Share Purchase Agreement dated 29th June 2025 as amended by an addendum dated 3rd July 2025 (Addendum) [Tau SPA] executed between the Parties and Tau Investment Holdings Pte. Ltd. (Seller), the Acquirer will purchase equity shares, amounting to 46.39% Combination Registration No. C-2025/07/1299 Page 2 of 33 shareholding, on a fully diluted basis, from the Seller, subject to the terms and conditions set out in the Tau SPA. (ii) Employee Share Purchase: Pursuant to the Share Purchase Agreement dated 3rd July 2025 executed between the Acquirer and certain employees of the Target (Employee SPA), the Acquirer will acquire equity shares, amounting to 2.41% shareholding, on a fully diluted basis, from such employees of the Target. (iii) Open Offer: Given that the Target is a listed company and the Acquirer is acquiring more than 25% shareholding in the Target pursuant to the Tau SPA, the Acquirer is required to make an open offer for the purchase of equity shares amounting to 26% of the Target’s equity share capital in accordance with Securities and Exchange Board of India (SEBI) (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (as amended) (Takeover Regulations) [Open Offer]. (iv) JB Merger: Pursuant to the Merger Implementation Agreement dated 29th June 2025 executed between the Parties and the Seller (MIA), the board of directors of the Parties, have approved a scheme of amalgamation between the Acquirer and the Target under Sections 230 to 232 and other applicable provisions of the Companies Act, 2013 (Scheme), pursuant to which, the Target will be amalgamated into the Acquirer as a going concern (JB Merger). [the Tau Share Purchase, the Employee Share Purchase, the Open Offer, and the JB Merger are collectively referred to as the ‘Proposed Combination’]. 2. The Notice was followed by additional submissions made on 23rd July 2025 vide which the Acquirer provided copies of the Employee SPA and the Addendum. 3. In terms of Regulation 14 of the Competition Commission of India (Combinations) Regulations, 2024 (Combination Regulations), vide letter dated 29th July 2025 (RFI Combination Registration No. C-2025/07/1299 Page 3 of 33 1), the Acquirer was required to provide certain information/document(s) by 5th August 2025. The Acquirer filed its reply on 6th August 2025 (Response 1). As certain defects and discrepancies were observed on examination of Response 1, vide letter dated 12th August 2025, issued in continuation of RFI 1 and Response 1 (RFI 2), the Acquirer was again asked to remove defect(s), explain discrepancies and furnish requisite information by 19th August 2025. The Acquirer filed its reply on 20th August 2025, after seeking extension of time (Response 2) and followed the same by additional submissions made on 8th September 2025. II. Parties to the Combination 4. The Acquirer is a publicly listed company and forms part of the Torrent group (Acquirer Group)1. The Acquirer Group is, inter alia, engaged in the business of manufacturing and selling of pharmaceutical products in India and worldwide; generation, distribution and transmission of power in India; and city gas distribution in various cities in India. 5. The Target is a publicly listed company which is, inter alia, engaged in business of manufacturing and marketing of diverse range of pharmaceutical formulations / finished dosage forms (FDFs) and Active Pharmaceutical Ingredients (APIs). In addition, it also provides contract development and manufacturing organisation (CDMO) services in India. III. Notice under Section 29(1) of the Act 6. The Commission, in its meeting held on 23rd September 2025, considered the information on record, details provided in the Notice and the responses filed by the Acquirer, and formed a prima facie opinion that the Proposed Combination is likely to cause an appreciable adverse effect on competition (AAEC) in certain relevant markets in India. Accordingly, in terms of Section 29(1) of the Act, a show-cause notice dated 25th September 2025 (SCN) was issued to the Parties, wherein the Parties were directed 1 The Acquirer Group is controlled by Mr. Sudhir Mehta & family and Mr. Samir Mehta & family. Combination Registration No. C-2025/07/1299 Page 4 of 33 to respond in writing, within 15 days of the receipt of the SCN, as to why investigation in respect of the Proposed Combination should not be conducted. 7. The Parties filed their response to the SCN on 16th October 2025 after seeking extension of time (Response to SCN). As part of the Response to SCN, without prejudice to the submissions that the Proposed Combination does not cause any AAEC in India, the Parties also proposed certain voluntary commitments / remedies, in Form IV read with Regulation 25(4) of the Combination Regulations (Modification), to address the prima facie concerns raised by the Commission in the SCN. 8. The Commission, in its meeting held on 21st October 2025, considered and assessed the Proposed Combination along with the SCN, the Response to SCN and the Modification. The analysis and findings of the Commission in respect of the Proposed Combination are given hereunder. IV. Activities of the Parties and areas of horizontal overlaps/vertical linkages 9. The activities of Torrent and JB relate to pharmaceutical sector in India at broader level. In the pharmaceutical value chain, the Parties are engaged in manufacture and sale of FDFs, APIs and provision of CDMO services in India. 10. As submitted, the Acquirer undertakes manufacture and sale of APIs in India only for captive purposes and accordingly there are no market facing overlaps in the API segment. As regards CDMO services, as submitted, the Acquirer has entered into an exclusive agreement with Novo Nordisk India to provide CDMO services for manufacturing of Human Insulin intended for sale in India and apart from this, the Acquirer is not engaged in provision of CDMO services for products intended for sale in India. The Target does not manufacture any such products for sale in India as part of its CDMO services. With respect to CDMO services for products intended for sale in India, the Target currently provides such services only for syrup and lozenges. It has been clarified that the Acquirer does not manufacture any such products for sale in Combination Registration No. C-2025/07/1299 Page 5 of 33 India as part of its CDMO services. Considering the aforesaid, the Commission narrowed down the primary area of assessment only to the FDFs. 11. The Proposed Combination has been assessed accordingly. V. Competition Assessment - FDFs 12. FDFs are the consumable form of medicines which can be consumed by/ administered to end-consumers. To cater to different medical conditions of the patient and depending on other factors, FDFs are manufactured and sold in various forms of administration, such as, FDFs which can be administered (i) orally (in the form of tablets, pellets, capsules, powder for solutions, microspheres), (ii) topically (such as, patches, ointments, creams, drops, etc.), (iii) as injectables (such as ampoules, syringes/injections and vials), or (iv) as inhalers. 13. For the purposes of competition assessment, FDF classifications are considered based on the Anatomical Therapeutic Chemical (ATC) classification system for medicines2. The Commission in its decisional practice has emphasised that the comprehensive assessment entails assessment at the molecule level followed by ATC3/ATC4 therapeutic groups. Accordingly, the assessment was undertaken considering the presence of the Parties in FDFs classified at the molecule level and ATC3/ATC4 therapeutic groups. 14. Based on the information provided by the Acquirer, horizontal overlaps were identified between the business activities of the Parties in the relevant markets for 64 FDF therapeutic segments at the ATC4 level and 38 FDF therapeutic segments at ATC3 level. In cases where overlapping ATC4 classification contained more than one 2 The ATC system is a drug classification system that classifies the active ingredients of drugs according to the organ or system on which they act and their therapeutic, pharmacological, and chemical properties. The EphMRA ATC classification system is a hierarchical and coded four level system. The first level (ATC 1) is the broadest and the most general whereas the fourth level (ATC4) is the narrowest and most detailed. In the ATC1 level, medicinal products are divided into 16 main anatomical groups. The second level (ATC2 level) is either a pharmacological or therapeutic group. The third and fourth levels (ATC3 and ATC4 level respectively) are chemical, therapeutic or pharmacological subgroups. Combination Registration No. C-2025/07/1299 Page 6 of 33 molecule, molecule level overlaps were identified in four (4) FDF therapeutic segments. (The overlapping FDF therapeutic segments identified at ATC4 / ATC3 / molecule level are collectively referred to as the ‘Horizontal FDF Markets’). For each of the Horizontal FDF Markets, the Commission further factored differences in galenic forms in its assessment. Further, wherever considered appropriate, the Commission also took note of dosage level bifurcation within each of the overlapping Horizontal FDF Markets. 15. Apart from the existing overlaps captured in Horizontal FDF Markets, the Commission also considered potential horizontal overlaps considering the pipeline products of both the Parties, existing products of the Acquirer with pipeline products of Target and existing products of the Target with pipeline products of the Acquirer. However, the Commission observed that the overlaps so identified are insignificant and do not merit detailed assessment. 16. Accordingly, the Commission undertook the detailed assessment of the Proposed Combination for Horizontal FDF Markets. For the purpose of ascertaining the presence of the Parties and competition landscape in relevant Horizontal FDF markets, consistent with the decisional practice, the Parties provided the requisite information as per the IQVIA dataset and the Commission has also based its assessment on the same. 17. On the basis of the combined market share of the Parties and incremental market share as a result of the Proposed Combination, the Commission narrowed its investigation to eight (8) Horizontal FDF Markets at an ATC4 level. For all other Horizontal FDF Markets, either (i) the combined share was less than 15%; or (ii) where the combined share exceeded 15% but did not exceed 30%, the incremental share was less than 5%; or (iii) where the combined share exceeded 30% but did not exceed 50%, the incremental share was less than 2%; or (iv) where the combined share exceeded 50%, the increment was less than 1%. Of these eight (8) Horizontal FDF Markets, the Proposed Combination was considered prima facie not likely to result in AAEC in five (5) Horizontal FDF Markets and likely to result in AAEC in three (3) Horizontal FDF Combination Registration No. C-2025/07/1299 Page 7 of 33 Markets. The analysis and findings of the Commission for each of the aforesaid eight (8) Horizontal FDF Market is detailed hereunder. Horizontal FDF Markets in which the Proposed Combination is not likely to raise AAEC concerns A07K0B LACTOBACILLUS RHAMNOSUS 18. In this relevant market, the market shares of Torrent and JB are estimated to be in the range of [10-15] % and [5-10] % respectively, i.e., the combined market share of the Parties is estimated to be in the range of [20-25] %. The market is characterized by presence of other significant competitors viz., Tablets India and FDC, each with an estimated market share of [10-15] %, and Aristo with a market share of [5-10] %. Considering the presence of the Parties and the competition landscape, the Proposed Combination is not likely to cause AAEC in the market for Lactobacillus Rhamnosus FDFs. C02C07 AZILSARTAN 19. In this relevant market, the market shares of Torrent and JB are estimated to be in the range of [5-10] % and [10-15] % respectively i.e., the combined market share of the Parties is estimated to be in the range of [20-25] %. The market is characterized by presence of at least three other significant competitors viz., Lupin which is estimated to have a market share of [15-20] %, and Emcure and Intas, each having a market share of [10-15] %. Considering the presence of the Parties and the competition landscape, the Proposed Combination is not likely to cause AAEC in the market for Azilsartan FDFs. C02F11 AZELNIDIPINE+ TELMISARTAN 20. In this relevant market, the market shares of Torrent and JB are estimated to be in the range of [20-25] % and [10-15] % respectively i.e., the combined market share of the Combination Registration No. C-2025/07/1299 Page 8 of 33 Parties is estimated to be in the range of [30-35] %. The market is led by Glenmark with an estimated market share of [25-30] % and includes IPCA with an estimated market share of [20-25] % and Ajanta with an estimated share of [10-15] %. These competitors are likely to be in a position to exert significant competitive constraint on the Parties. Considering the presence of the Parties and the competition landscape, the Proposed Combination is not likely to cause AAEC in the market for Azelnidipine + Telmisartan FDFs. C10A0S ROSUVASTATIN + EZETIMIBE 21. In this relevant market, the market shares of Torrent and JB are estimated to be in the range of [10-15] % and [5-10] % respectively, i.e., the combined market share of the Parties is estimated to be in the range of [15-20] %. The market is characterized by presence of at least three other significant competitors viz., USV and Emcure each of which is estimated to have a market share in the range of [20-25] %, and Lupin which is estimated to have a market share in the range of [10-15] %. These competitors are likely to be in a position to exert significant competitive constraint on the Parties. Considering the presence of the Parties and the competition landscape, the Proposed Combination is not likely to cause AAEC in the market for Rosuvastatin + Ezetimibe FDFs. D02A02 DIAPER RASH CREAMS 22. In this relevant market, the market shares of Torrent and JB are estimated to be in the range of [15-20] % and [10-15] % respectively i.e., the combined market share of the Parties is estimated to be in the range of [25-30] %. The market is led by Abbot with market share of [35-40] % and includes Himalaya with share of [10-15] % and Apex with share of [5-10] %. Considering the presence of the Parties and the competition landscape, the Proposed Combination is not likely to cause AAEC in the market for Diaper Rash Creams. Combination Registration No. C-2025/07/1299 Page 9 of 33 Horizontal FDF Markets in which the Proposed Combination is likely to raise AAEC concerns 23. As regards the assessment of markets in which the Proposed Combination is likely to raise AAEC concerns, the Commission followed a two-step approach for the assessment. First, the Commission considered the market structure, concentration levels and change in concentration resulting from the Proposed Combination for each Horizontal FDF and second, the Commission considered the overall aspects of entry barriers, price constraints from regulations relating to the price of essential medicines listed in the National List of Essential Medicines (NLEM) under the Drugs (Prices Control) Order, 2013 (DPCO 2013), buyer power etc. Assessment in terms of market structure etc. A07K02 LACTOBACIL.ACIDOPHILUS 24. The Commission observed that the presence of the Parties in the market for Lactobacillus Acidophilus is highly significant with Torrent’s share estimated to be in the range of [35-40] % and Target’s share estimated to be in the range of [60-65] % resulting in a combined share of [95-100] %. The same is indicative of the Proposed Combination being likely to result in a significant change in concentration levels in the market for Lactobacillus Acidophilus and eliminate the only plausible source of competitive constraints on the Parties. 25. The Acquirer submitted that while drugs within the same therapeutic group (i.e., FDFs grouped at ATC 3 classification codes level) are generally not substitutable due to differences in intended use, mechanism of action, mode of administration, and the underlying molecule, this does not hold true for Lactobacillus Acidophilus. In support of the same, the Acquirer made, inter alia, the following submissions: i. Insights based on research of Strategic Marketing Solutions and Research Centre (SMSRC) - SMSRC has provided insights based on its research and issued a Combination Registration No. C-2025/07/1299 Page 10 of 33 certificate attesting that multiple probiotic strains, including Lactobacillus Acidophilus and Lactobacillus Rhamnosus are prescribed across a wide range of gastrointestinal indications and are functionally interchangeable in clinical practice. ii. Medical opinions - Medical opinions stipulate that various probiotic strains such as Lactobacillus Acidophilus, Bacilus clausi, Sachharomyces Boulardii, Lactobacilus Rhamnosus and others are substitutable and interchangeable. iii. World Gastroenterology Organization (WGO) Guidelines - A reference was made to WGO Guidelines which note that strains such as acidophilus, casei, rhamnosus, boulardii have demonstrated positive outcomes in antibiotic associated diarrhoea (AAD). 26. The Commission observed that for any candidate product to be included in the same relevant market, there should be sufficient cause in terms of the competitive constraints for inclusion of the same and only then the market definition arrived at reflects the most relevant constraints on the behaviour of the parties to a combination. To this effect, the Act emphasises delineation of relevant market based on comprehensive consideration of characteristics, intended use and price. Accordingly, the Commission examined the submissions on substitutability of various strains from the perspective of competitive constraints in accordance with the framework contained in the Act. 27. The Commission observed that the aforementioned submissions of the Acquirer centre on the aspect of common intended use only, which is just one of the aspects of delineation of relevant market. Even in this regard, the studies and guidelines referred by the Acquirer are neither comprehensive nor absolute and appear to be broad generalisations. Also, as observed, as per information available in public domain, the efficacy of probiotics depends on mode specificity, strain specificity and disease specificity. Further, the ATC classification in itself factors various aspects relevant to a product such as FDF viz., drug’s properties, uses, specific chemical structure or a particular method of action. In addition, classification at ATC 4 level reflects the Combination Registration No. C-2025/07/1299 Page 11 of 33 functional differentiation of various FDFs which may be grouped together at ATC 3 levels. In view of the above and in absence of any submissions on the aspects of strain and disease specificity, it does not appear that all probiotics forming part of broader ATC 3 level (A07K) are functionally interchangeable. 28. As regards the characteristics, based on the information in public domain, the Commission noted that the characteristics of different strains are different. To illustrate, Bacillus clausii is a spore-forming bacterium, Lactobacillus Acidophilus is a lactic acid bacterium, and Saccharomyces Boulardii is a yeast and these differences in characteristics confer different strengths to respective strains and determine their most suitable specific use cases. In context of FDFs, therapeutic, pharmacological, and chemical properties are considered highly significant, and ATC classification is undertaken accordingly. In this backdrop, the differences in characteristics appear relevant to the aspect of substitutability both in functional and competition context. 29. As regards the pricing of these strains, based on data submitted by the Acquirer, it is noted that there are significant differences in prices of various strains. While the average price of Lactobacillus Acidophilus FDFs is around Rs. 7.5 per tablet, the same for Bacillus Clausii and Saccharomyces Boulardii is more than Rs. 50. The Commission noted the submissions of the Acquirer on differences in prices of various probiotic strains not being reflective of therapeutic superiority but rather the outcome of historical, regulatory, and commercial factors. In this regard, the Commission observed that the question is on substitutability of strains considering intended use, characteristics and price. As examined above, the strains have not been found substitutable in terms of characteristics and intended use. In the context of price, the question is whether these strains impose competitive constraints on each other to the extent meriting to be part of the same relevant market and to that effect, the significant differences in prices of various strains of probiotics and Lactobacillus Acidophilus seems to negate the substitutability of strains even from pricing perspective. 30. Based on the aforesaid, the Commission formed a prima facie view that the submissions of the Acquirer to consider a broader ATC 3 level market for probiotics Combination Registration No. C-2025/07/1299 Page 12 of 33 prima facie do not appear tenable and the Proposed Combination is likely to cause AAEC in the market for Lactobacillus Acidophilus FDF. 31. The Parties, in the Response to SCN, again emphasised the aforesaid submissions and stated that while FDFs are known to be differentiated functionally, based on their different ATC-4 classifications, in the case of probiotics, the ATC-4 classifications are blurry and that the probiotic market should be seen irrespective of their separate ATC- 4 classification, because in the pharmaceutical sector, demand side (i.e., consumers /patients) majorly focuses on the intended use of the FDF, and pay less heed on the other factors relevant for delineation of relevant market, viz., price and characteristics, as the focus of the consumer is on recovery from the ailment, even if it is at a higher cost and/or possesses different characteristics (molecules). 32. The Commission noted the submissions of the Parties and observed that the same is not sufficient to conclude a broader market for probiotics from competition assessment perspective and accordingly, the relevant market is not broader than that defined at ATC 4 classification code level and is limited to the FDF of Lactobacillus Acidophilus. 33. Accordingly, the Commission assessed the Proposed Combination in the market of Lactobacillus Acidophilus and noted that the Parties would have an overwhelming presence in the market post the Proposed Combination and that the Proposed Combination is likely to result in significant change in market structure and eliminate the most relevant competitive constraints in the market. Assessment in terms of market structure – C01D01 NIFEDIPINE 34. Based on the information provided by the Acquirer, the Commission observed that Torrent and JB’s market shares are estimated to be in the range of [0-5] % and [90-95] % respectively resulting in a combined market share in the range of [95-100] %. Accordingly, the Proposed Combination is likely to result in a significant change in competition dynamics in the market for Nifedipine as the top two competitors would come together. Combination Registration No. C-2025/07/1299 Page 13 of 33 35. In this regard, the Acquirer submitted that the incremental addition contributed by the Acquirer due to the Proposed Combination is small (less than 5%) and that there will be no significant change in the market dynamics due to the Proposed Combination in the market for Nifedipine FDFs. However, the Commission observed that significance of increment depends on market structure and is to be considered in terms of resulting change in competition dynamics. For Nifedipine, even if the Acquirer’s share is less than 5%, the change in concentration as reflected in incremental HHI is more than 700 while the post combination HHI is more than 9000. Further, the significance of increment is also reflected in the fact that the Acquirer is the second biggest player in the market (albeit remote 2nd biggest player), and the Proposed Combination is combination of top two players in this segment. Accordingly, the Proposed Combination is likely to eliminate the only significant competitive constraint on the Target in this segment. 36. The Acquirer further submitted that Amlodipine is a relevant therapeutic equivalent alternative of Nifedipine. It has been stated that Amlodipine has a higher rate of efficacy in terms of superior pharmacokinetics (such as maintaining longer therapeutic levels), leading to improved patient compliance3, patients and prescribers have shifted to Amlodipine, over the years. In this backdrop, it has been stated that though both Amlodipine and Nifedipine are L-type Calcium Channel Blockers (CCBs), Amlodipine has lately become the first choice in comparison to both the CCBs. 37. The Commission noted that the rationale for existence of a separate ATC 4 level classification reflecting functional differentiation of various FDFs, which may be grouped together at ATC 3 levels, as considered for the Lactobacillus Acidophilus FDFs, also applies to Nifedipine and Amlodipine. Further, the Commission, based on information in public domain observed that Nifedipine is characterised by a rapid onset of action. Furthermore, the submissions of the Acquirer on Amlodipine being better tolerated with fewer side effects compared to Nifedipine, in itself indicate the 3 Source: (https://www.tandfonline.com/doi/full/10.3109/08037051.2012.690615#abstract) Combination Registration No. C-2025/07/1299 Page 14 of 33 differences between these formulations from pharmacological and therapeutic perspective. Also, the prevalence and growth of Nifedipine further indicates its uniqueness from therapeutic perspective. 38. From pricing perspective, Amlodipine and Nifedipine appear to be differently placed. As per the Acquirer, one study has indicated that Amlodipine 5 mg is equivalent to Nifedipine 30 mg for postpartum blood pressure control. In this regard, the Commission notes that firstly the submissions are for a particular condition and do not justify a broader finding on substitutability and secondly there is no price parity between the Amlodipine and Nifedipine FDFs. The Target’s 30 mg Nifedipine is priced at Rs. 17.53 per tablet4 while Amlodipine 5 mg is priced at Rs. 1.5 per tablet (Cipla brand)5. Though the Acquirer has emphasised that price is not relevant, the same appears to be untenable as the price is one of the important factors that help in evaluating competitive constraints on a product. 39. Based on the aforesaid, the Commission formed a prima facie view that the Proposed Combination is likely to cause AAEC in the Nifedipine FDF market. 40. The Parties vide their Response to SCN reiterated their submissions and submitted that price differential between Nifedipine and Amlodipine must be contextualised and that prescribing behaviour in the relevant therapeutic class demonstrates that physicians substitute between CCBs including Amlodipine, Nifedipine, Cilnidipine, and others based on patient needs, not on minor price variations. Accordingly, it was stated that patients’ out-of-pocket expenditures for these medicines are relatively modest in the context of overall therapy costs, and compliance is driven by physician guidance rather than marginal price differences. Further, as submitted, while price is one of several competitive parameters, it does not, by itself, invalidate the position that Amlodipine and Nifedipine exert mutual competitive constraints as part of the broader CCB therapeutic space. The Commission again observed that the aspects of prescription 4 https://www.1mg.com/drugs/nicardia-xl-30-tablet-754549 5 https://www.1mg.com/drugs/amlip-5-tablet-43925 Combination Registration No. C-2025/07/1299 Page 15 of 33 being strictly based on patient needs in fact further support the limited substitutability aspect even from functional perspective. 41. Accordingly, the submissions of the Acquirer to consider Amlodipine as a part of the same relevant market as Nifedipine and to consider the increment as insignificant do not appear tenable and with that being the market, the Parties are estimated to have a highly significant presence in the market post the Proposed Combination and the Proposed Combination is likely to result in significant change in market structure and eliminate a significant competitive force exerting constraints on the market position of the Target in the Nifedipine FDF market. Assessment in terms of market structure – C01D0E AZELNIDIPINE 42. Based on the information provided by the Acquirer, the Commission observed that the presence of the Parties in this segment is significant with Torrent’s share estimated to be in the range of [30-35] % and Target’s share estimated to be in the range of [10-15] % resulting in a combined share of [45-50]%. Accordingly, the Proposed Combination is likely to result in significant change in concentration levels. 43. In terms of theory of harm, the Commission observed that as per data on 1mg, the Acquirer’s drug sold under the brand name Uniaz is the costliest. Based on the information available in public domain, it is noted that the Target’s drug is 13% cheaper as compared to the Acquirer’s drug. Given the said difference in prices, the incentive for the Acquirer to compete with its own cheaper drug post the Proposed Combination with the most expensive drug appears unlikely. 44. Thus, given the significant presence and the market dynamics in terms of product positioning and pricing, the Proposed Combination is likely to incentivize elimination of a cheaper drug formulation triggering prima facie concerns of likelihood of AAEC in the Azelnidipine FDF. Combination Registration No. C-2025/07/1299 Page 16 of 33 45. In the Response to SCN, the Parties submitted that their combined market share has seen a consistent decline from ~53% to ~46%, in spite of the Azelnidipine Market growing manifold from INR 9.04 crore in FY 2021 to INR 29.05 crore in FY 2025. It was submitted that IPCA Labs has risen to the second position with a 32% market share within a few years of launch, while Ajanta, Emcure, Glenmark, and La Renon have also achieved substantial shares. Basis the aforesaid, it was stated that the Azelnidipine market masks high churn and rapid growth of new entrants and that this volatility of the Azelnidipine market indicates the fluidity of the positions and market power of each player, even if a certain player has held substantial market share. It was further stated that the Azelnidipine Market as a whole, faces certain constraints exerted by other CCBs, such as Amlodipine and Cilnidipine, which are the preferred CCBs. 46. The Commission considered the submissions of the Parties and observed that while the shares of the Parties have indeed declined, yet the same remain significant. More importantly, the Commission’s theory of harm was focussed on ability and incentive on the part of the Parties to maintain the two competing drugs in the market and ensuring the competition efficacy between the two as these drugs were competing before the Proposed Combination. In this regard, the Parties have made no submissions and accordingly the concerns of the Commission arising from the structural change in market for Azelnidipine remain unaddressed. Assessment of likelihood of AAEC in terms of other factors Entry Conditions 47. The Acquirer has made submissions on entry conditions for various Horizontal FDF markets of concern. As submitted, • Entry into the probiotics market is further facilitated through the over-the- counter (OTC) channel. It has been stated that while there are no specific rules for OTC classification of drug products, probiotic supplements and functional foods under the Food Safety and Standards Authority of India (FSSAI) benefit Combination Registration No. C-2025/07/1299 Page 17 of 33 from a streamlined approval process and that the standard formulations can be launched within approximately three months. • As regards Nifedipine, it has been stated that players willing to enter this market do not face stringent regulatory / legal hurdles and only require a state food and drug administration (State FDA) licence. The process of obtaining such a licence is also fairly simple and straightforward and subject to the licencing requirements being met, the State FDA typically grants the licence within a period of about one month. • As regards Azelnidipine, it has been stated that entry is facilitated by the molecule’s off-patent status in India, which allows new players to enter with generic versions without requiring costly or time-consuming clinical trials. Approvals by the Central Drugs Standard Control Organisation (CDSCO) are granted on the basis of bioequivalence studies, thereby making entry cost- efficient and relatively rapid. 48. In this regard, it is to be noted that the market landscape, going by the estimates of market shares for the last 5 years, has remained in a similar zone for Lactobacillus Acidophilus and Nifedipine. The combined market share has treaded in a narrow range of [90-95] % to [95-100] % for both Lactobacillus Acidophilus and Nifedipine. It is only for Azelnidipine that the combined share has gone down from [50-55] % to [45- 50] %. However, the position of the Parties even in Azelnidipine FDF has remained strong. In the recent past, there seems to have been no entry of any credible competitor in these markets. Also, for consideration as a mitigating factor, entry has to be visible (for example, pipeline product of a competitor), timely and effective. In absence of any substantiation on these, considering ease of entry as a factor that negates the significant change in concentration levels and addresses concerns of likelihood of AAEC arising from the changed market structure is not plausible. 49. The Commission further observed that while the Acquirer has submitted brand loyalty to be low, the market dynamics seem to indicate otherwise. As observed, illustratively, the Acquirer’s and Target’s Nifedipine 20 mg tablet is 115% and 112% costlier than the offering of Zeelab Pharmacy, yet the Parties collectively cater to [95-100] % of Combination Registration No. C-2025/07/1299 Page 18 of 33 Nifedipine market6. Similarly, for Azelnidipine, while Torrent’s FDF is priced 15% more than IPCA, it is the market leader with share in the range of [30-35] %. Accordingly, brand penetration and consequent brand loyalty appear to be working as entry barriers also for said FDFs. Jan Aushadhi and competition from generics 50. The Acquirer has also made submissions on constraints from Jan Aushadhi program. As submitted, there is competition from outside the defined branded segment in the form of trade generics and unbranded generics available through schemes such as Jan Aushadhi. First and foremost, the brand penetration and brand loyalty examined above also implies lack of constraints from trade generics, unbranded generics and Jan Aushadhi. Further, as regards efficacy of constraints from Jan Aushadhi, the key is the extent of market being catered by the scheme. In this regard, the Acquirer has provided a report published by Kotak Institutional Equities which reads that ‘On a combined basis, Jan Aushadhi, trade generics and private generic pharmacy chains constitute ~20% of total drug volumes in India.’ However, the report also notes that ‘despite improvement in the past few years, supply chain challenges within the Jan Aushadhi program still remain, and it remains critical to ensure the continuity of supplies amid the rapid store additions.’ Also, there is no specific submission made on constraints, if any, posed by Jan Aushadhi channel on the aforesaid FDFs, and in absence of the same, the submissions of the Parties remain general. Countervailing Buyer Power 51. As submitted, large institutional buyers such as government agencies, large hospitals, and schemes like Jan Aushadhi procure FDFs in bulk through competitive tenders, where price is the principal selection criterion. In this regard, first and foremost, it needs to be noted that the consumers of trade channel and non-trade channel cannot be considered as belonging to the same market given their needs and modus operandi. The 6 https://www.1mg.com/drugs/nifizee-sr-20-tablet-824963 Combination Registration No. C-2025/07/1299 Page 19 of 33 Acquirer has not made any submission on buyer power vested with the customers of non-trade channel to which the FDFs cater. Vide Response to SCN, it was submitted that countervailing buyer power exists across both the trade and non-trade channels. With respect to the non-trade channel, i.e., sales through the retail trade route (chemists, pharmacies, distributors), it is submitted that significant buyer power resides with stockists, large distributors, and pharmacy chains and that these entities procure in bulk from multiple suppliers and typically demand competitive margins, credit terms, and promotional support. The Commission observed that the submissions remained unsubstantiated and considering the nature of FDFs wherein the demand is primarily based on doctor prescription and there is an element of brand loyalty, the stockists etc. possessing buyer power to the extent that the concerns rooted in such significant presence as discussed above are mitigated appears highly unlikely. Price Controls 52. As submitted, prices of drugs in India are regulated as per the provisions of DPCO, 2013. The National Pharmaceutical Pricing Authority (NPPA) fixes ceiling prices of scheduled medicines specified in the First Schedule to DPCO, 2013. As per the provisions of DPCO, 2013, the ceiling prices of scheduled medicines are revised annually based on Wholesale Price Index (All commodities) for the preceding calendar year, on or before the 1st of April of every year. For non-scheduled formulations, including for non-scheduled anti-diabetic, anti-cancer and cardiovascular formulations, manufacturers are required to not increase MRP of drugs launched by them by more than 10% during the preceding 12 months. 53. In this regard, the Commission notes that the aforesaid price caps may not always address the competition concerns which may be more wide ranging. Further, given the facts of the Proposed Combination, only one FDF i.e., Nifedipine and only one dosage form of Nifedipine (10 mg) is covered under the NLEM and the same also constitutes only 17% of the said FDF market and accordingly is not likely to fully address the competition concerns. Combination Registration No. C-2025/07/1299 Page 20 of 33 54. For the reasons set out in the preceding paragraphs, the Commission formed prima facie view that the Proposed Combination is likely to cause AAEC in the relevant markets as delineated hereinabove. However, as stated earlier, in the Response to SCN, on a without prejudice basis, the Parties proposed a Modification to address the prima facie concerns raised by the Commission. The Commission considered the Modification in terms of its adequacy to address the potential adverse impact of structural changes in the market resulting from the Proposed Combination. Analysis of Modification proposed by the Parties 55. The Modification proposed by the Parties envisage: i. The Acquirer will license its Vizylac brand, comprising products containing Lactobacillus Acidophilus as a single strain FDF to an independent entity for a period of five (5) years from the date of such licence (Licence Period), for a lump sum licence fee, as agreed between the Acquirer and licensee [Lactobacillus Acidophilus Remedy]. ii. The Acquirer will divest or procure the divestiture of all products containing Nifedipine which are currently marketed and supplied under the Calcigard brand, to a purchaser, on terms of sale approved by the Commission [Nifedipine Remedy]. iii. The Acquirer commits to continue the marketing and sale of the Target’s Azovas brand. The Acquirer will voluntarily undertake to cap any price increases for Azovas at no more than 5% per annum for a period of three (3) years from the date of the order approving the Proposed Combination [Azelnidipine Remedy]. 56. The Commission observed that the Modification proposed is a mix of structural and behavioural remedies and includes licensing of a brand, divestiture of an FDF and price caps and continuation of marketing and sale of a brand. The Commission in this regard Combination Registration No. C-2025/07/1299 Page 21 of 33 noted that regardless of the type of modification, it needs to be examined in terms of its adequacy to address the competition concerns. 57. The Commission noted that the extent of presence of the Parties and the impact on concentration levels for Lactobacillus Acidophilus and Nifedipine merit a proper structural remedy. The Parties proposal to divest all products containing Nifedipine implies elimination of overlap between the FDFs of the Parties containing Nifedipine and accordingly would ensure no adverse effect on competition in this product segment. As regards Lactobacillus Acidophilus, the operational dynamics are different. Vizylac brand is offered containing Lactobacillus Acidophilus as a single strain FDF and also in form of extension brands containing multi-strain or combination probiotic variants. However, the concerns of the Commission are limited to FDFs containing Lactobacillus Acidophilus as a single strain FDF. The principle of proportionality requires that any remedy imposed must be appropriate and no more onerous than necessary to resolve the identified competition concerns, and under the circumstances, complete divestiture of Vizylac brand is likely to be disproportionate. Accordingly, the Commission observed that licensing appears to be a proportionate remedy. The next question which arises in this regard is the period of licensing. The Parties have proposed a period of five (5) years and the Commission is of the view that the period appears reasonable to prevent any adverse effect of the Proposed Combination on market dynamics and allow the market dynamics to evolve with the changing landscape. 58. As regards Azelnidipine, the market dynamics and the theory of potential harm is different. The Commission observed that the dynamics indicate a competitive market wherein the Parties combined share has decreased over time and IPCA Labs has grown significantly over the same period. In addition, there are other significant competitors as well. The limited concern of the Commission for Azelnidipine FDF relates to plausible lack of incentive on the part of the Parties to either maintain the marketing and sale of Target’s FDF containing Azelnidipine or to resort to a significant price increase if the FDF is continued to be marketed, as the same is ~ 13% cheaper than that of the Acquirer. Considering these concerns, a behavioural remedy as per which the Combination Registration No. C-2025/07/1299 Page 22 of 33 Parties undertake to continue the marketing and sale of the Target’s brand and also to cap any price increases for Azovas at no more than 5% per annum for a period of three (3) years from the date of the Order appears adequate and proportionate to address the competition concerns. 59. Accordingly, considering the specific issues of adverse effect on competition for each FDF of concern and the corresponding remedy offered by the Parties as part of the Modification, the Commission is of the view that the Modification can be accepted and the Proposed Combination seen together with the Modification is not likely to raise AAEC concerns for any relevant market. 60. Considering the material on record, details provided in the Notice, Response to SCN, factors provided under sub-section (4) of Section 20 of the Act and the Modification proposed by the Parties, the prima facie concerns of a likely AAEC as set out in the SCN have been addressed by the Acquirer. The Commission, thus, decided not to proceed further with the investigation. 61. The Commission hereby approves the Proposed Combination under sub-section (1) of Section 31 of the Act, subject to the compliance of the Modification offered by the Parties under Regulation 25(4) of the Combination Regulations as a part of the Response to SCN. 62. The Annexure containing the detailed terms and conditions of Modification is annexed to the order and shall form an integral part of the order. 63. In carrying out the Modification, the Parties shall comply with the provisions of the Act, the Combination Regulations and the Competition Commission of India (General) Regulations 2024 (General Regulations). 64. In case the Parties fail to comply with the Modification as provided in the Annexure, the Proposed Combination would be deemed to have caused AAEC in India and the Combination Registration No. C-2025/07/1299 Page 23 of 33 Parties shall render itself liable for being proceeded under the relevant provisions of the Act. 65. This order may be revoked if, at any time, the information provided by the Parties is found to be incorrect. 66. The information provided by the Parties shall be treated as confidential in terms of and subject to the provisions of Section 57 of the Act. 67. The Secretary is directed to communicate to the Acquirer accordingly. Combination Registration No. C-2025/07/1299 Page 24 of 33 Annexure Modification A. PRODUCTS I. Lactobacillus Acidophilus (A07K02) 1. The Acquirer will license its Vizylac brand, comprising products containing Lactobacillus Acidophilus as a single strain FDF to an independent entity for a period of five (5) years from the date of such licence (Licence Period), for a lump sum licence fee, as agreed between the Acquirer and licensee. 2. During the Licence Period, the licensee will have exclusive rights to manufacture, market, distribute and sell Vizylac in India. In the event the licensee sources the Vizylac brand from a contract development and manufacturing organisation (CDMO), the licensee may do so either from the same CDMO that presently manufactures Vizylac for the Acquirer or such other CDMO, identified by the licensee and as mutually agreed between the Acquirer and the licensee. Upon expiry of the Licence Period, all rights in relation to the Vizylac brand will revert to the Acquirer. 3. It is clarified that only the Vizylac brand (containing Lactobacillus Acidophilus as a single strain FDF) will be licensed and all extension brands (multi-strain or combination probiotic variants) will remain with the Acquirer. II. Nifedipine (C01D01) 4. The Acquirer will divest or procure the divestiture of all products containing Nifedipine which are currently marketed and supplied under the Calcigard brand, to a purchaser, on terms of sale approved by the Commission. Combination Registration No. C-2025/07/1299 Page 25 of 33 5. The Acquirer will undertake the sale, transfer, assignment of all products containing Nifedipine as a single molecule FDF which are currently marketed and supplied under the Calcigard brand name by the Acquirer. 6. The divestment will include associated rights, stocks, permits, distribution contracts, and other necessary assets to ensure continued economic viability and competitiveness of the Calcigard brand. (Hereinafter, Vizylac and Calcigard are collectively referred to as “Remedy Products”) III. Azelnidipine (C01D0E) 7. The Acquirer commits to continue the marketing and sale of the Target’s Azovas brand. The Acquirer will voluntarily undertake to cap any price increases for Azovas at no more than 5% per annum for a period of three (3) years from the date of receipt of the Order (Effective Date). 8. The Acquirer will ensure the manufacture of the two respective Azelnidipine products of the Parties to continue at the existing in-house facilities and will not consolidate manufacturing at a single facility. 9. The Acquirer shall, on an annual basis (starting from the Effective Date), report in writing to the Commission on compliance of the modification proposed in relation to Azelnidipine. The report shall contain requisite details to substantiate the compliance of the modification. B. STRUCTURE OF THE REMEDY PRODUCTS 10. The Remedy Products shall include: Combination Registration No. C-2025/07/1299 Page 26 of 33 (i) all tangible assets including but not limited to all raw materials, stocks, work in progress, and semi-finished and finished goods relating to the Remedy Products; (ii) intangible assets (including intellectual property rights (IPRs)) which contribute to the current operation or are necessary to ensure the economic viability, marketability and competitiveness of the Remedy Products; (iii) all licences, permits and authorisations (including marketing authorisations) issued by any governmental organisation, relating to the Remedy Products and all contracts, leases, commitments and customer orders, relating to the Remedy Products; (iv) all customer records, credit records and other records, relating to the Remedy Products; and (v) all information and know how (in whatever form held) to the extent that such information is related to the distribution of Remedy Products in India including, without limitation, all by way of either a full assignment or an exclusive, irrevocable, assignable, licence in the Remedy Products, as may be applicable. 11. The Remedy Products shall not include: (i) any manufacturing facilities of the Acquirer; (ii) IPRs which do not contribute to the current operations and/or are not necessary to ensure the economic viability, marketability and competitiveness of the Remedy Products; (iii) books and records required to be retained pursuant to any statute, rule, regulation or ordinance, provided that an approved licensee / purchaser shall be entitled to obtain a copy of the same and shall be permitted access to the original of such books and records during normal business hours; (iv) general books of accounts and books of original entry that comprise the Acquirer’s permanent accounting or tax records; (v) monies owed to the Acquirer by customers for the licence / purchase of Remedy Products and monies owed by the Acquirer to suppliers for materials used in the production of the Remedy Products, or to suppliers for the production of the Remedy Products; and Combination Registration No. C-2025/07/1299 Page 27 of 33 (vi) the Acquirer’s names or logos in any form (except the logos and names pertaining to Remedy Products). C. PRESERVATION OF ECONOMIC VIABILITY, MARKETABILITY AND COMPETITIVENESS 12. The Acquirer undertakes to preserve the economic viability, marketability, and competitiveness of the Remedy Products, in accordance with good business practice, and shall minimise as far as possible any risk of loss of competitive potential of the Remedy Products. In particular, the Acquirer undertakes to: (i) from the date of the Order and until the licence / sale of the Remedy Products, ensure that the applicable inclusions mentioned under the scope of the Remedy Products, shall remain intact to ensure their continued economic viability, marketability, and competitiveness; and (ii) not carry out any action that might have a significant adverse impact on the value, management, or competitiveness of the Remedy Products or that might alter the nature and scope of activity, or the industrial or commercial strategy of the Remedy Products. 13. Until the licence / sale of the Remedy Products, the Acquirer shall maintain the operations of the Remedy Products in the regular and ordinary course of business and in accordance with past practices and shall use their best efforts to preserve the existing relationships with suppliers, vendors, customers, agencies, and others having business related to the Remedy Products. 14. The Acquirer shall provide such reasonable transitional support for a period of six (6) months from the date of the transfer of the Remedy Products to the approved licensee / purchaser to effectively implement the Modification offered in relation to the Remedy Products. This shall include the services, products, or support supplied by the Acquirer in relation to the Remedy Products under current arrangements, unless otherwise agreed with the approved licensee / purchaser. Combination Registration No. C-2025/07/1299 Page 28 of 33 D. APPOINTMENT OF HOLD SEPARATE MANAGER 15. Within seven (7) days from the Effective Date, the Acquirer shall appoint a senior management level employee having sufficient experience in the operations and management of the Remedy Products who shall ensure that the economic viability, marketability and competitiveness of the Remedy Products are maintained till the completion of Modification as regards the Remedy Products (Hold Separate Manager). The Hold Separate Manager shall, on a quarterly basis (starting from the Effective Date), report in writing to the Monitoring Agency on economic viability, marketability and competitiveness of the Remedy Products. The Hold Separate Manager shall report immediately in writing to the Monitoring Agency of any failure on part of the Parties to comply with the Order. The Hold Separate Manager shall ensure that the quarterly report is submitted or any instance of failure on the part of the Parties is informed to the Commission immediately until the Monitoring Agency is appointed. The Hold Separate Manager shall also be the nodal officer who shall act as the single point of contact for supervising the licence / divestment process. E. APPROVED PURCHASER(S) CONDITIONS 16. The potential licensee / purchaser of the Remedy Products proposed by the Acquirer shall meet the following requirements (“Licensee / Purchaser Requirements”): (i) be independent of the Parties; (ii) have the financial resources, proven expertise, manufacturing capability or ability to outsource manufacturing and incentive to maintain and develop the Remedy Products as a viable and active competitor to the Parties in the relevant markets; (iii) be a company active in the sales and marketing of pharmaceutical products in India; and (iv) neither be likely to create, in the light of the information available to the Commission, prima facie competition concerns nor give rise to a risk that the implementation of the Order will be delayed, and must, in particular, reasonably Combination Registration No. C-2025/07/1299 Page 29 of 33 be expected to obtain all necessary approvals from the relevant regulatory authorities for the acquisition of the Remedy Products. 17. It is clarified that the existence of ordinary-course commercial or financial transactions between the Parties and any otherwise independent entity, such as arm’s-length supply, distribution, or service arrangements, etc. shall not, by itself, render such entity ineligible to licence or acquire the Remedy Products. F. MODE OF SELECTION OF THE APPROVED LICENSEE / PURCHASER 18. The licensee / purchaser, as the case may be, will be identified through a structured and transparent process, ensuring that only qualified and credible parties are considered. The Acquirer will engage with potential licensees / purchasers meeting the above requirements and seek the Commission’s prior approval of the final licensee / purchaser. 19. The potential licensees / purchasers will be given access to sufficient information to conduct reasonable due diligence on the Remedy Products. This may include commercial, regulatory, and operational details necessary to assess the viability of the Remedy Products. To safeguard confidentiality, such access will be subject to execution of appropriate confidentiality agreements. G. NEGOTIATION AND EXECUTION OF SALE / TRANSFER/ LICENSE AGREEMENTS 20. In respect of Vizylac, the Acquirer will enter into a licensing arrangement with the licensee granting an exclusive licence to manufacture, market, distribute, and sell Vizylac in India. In the event, the licensee will source the Remedy Product from a CDMO, the licensee may do so either from the same CDMO that presently manufactures Vizylac for the Acquirer or such other CDMO identified by the licensee and as mutually agreed between the Acquirer and the licensee. It is further clarified Combination Registration No. C-2025/07/1299 Page 30 of 33 that only the Vizylac mother brand (single strain Lactobacillus Acidophilus) will be licensed, while all extension and multi strain variants of Vizylac shall remain with the Acquirer. The licensing arrangement will also provide that upon the expiry of the Licence Period, all rights, title, and interest in the Vizylac brand shall automatically revert to the Acquirer. 21. In respect of Calcigard, the Acquirer will execute an agreement transferring all relevant brand rights, licences, permits, distribution arrangements, and associated assets to an independent purchaser, ensuring continued economic viability and competitiveness of the Calcigard brand. 22. All agreements, whether by way of licence (for Vizylac) or sale (for Calcigard), will set out detailed rights and obligations of the parties, transitional support provisions, assignment of regulatory approvals, and timelines for completion. 23. It is clarified that each final and binding licence / sale and purchase agreement(s) shall be conditional on the Commission’s approval and will take effect only upon such approval being granted. H. NO ACQUISITION OF INFLUENCE 24. The Parties shall, for a period of five (5) years from the Effective Date, not acquire direct or indirect influence over the whole or part of the Remedy Products. I. LICENCE / DIVESTITURE PERIOD 25. The Acquirer undertakes to complete the licence / divestment process within a period of ----------- ----------- -------------- ----------- ----------- ------------ ---------- --------- ----- -------- ------------------ -------------------- ------------- ------------- ----------- ------- - ------ --- -- ------ -- --- ----------- This constitutes the ‘First Divestiture Period’. Combination Registration No. C-2025/07/1299 Page 31 of 33 26. In the event that the Remedy Products are not licensed and/or divested within the First Divestiture Period, the Acquirer undertakes that such products shall be transferred to an independent third-party agency (Divestiture Agency), to be appointed by the Commission which shall have full authority to divest the Remedy Products on terms it deems appropriate. This constitutes the ‘Second Divestiture Period’. 27. During the Second Divestiture Period, the Divestiture Agency shall have the right and authority to sell the Remedy Product(s) at no minimum price, and the divestiture shall not be implemented by the Divestiture Agency until and unless the Commission has approved the purchaser and the terms of sale and purchase agreement(s) as proposed by the Divestiture Agency. A copy of the divestiture agency agreement(s) shall be provided to the Acquirer, and the Acquirer shall use their best efforts to facilitate the Divestiture Agency, in the performance of its duties and obligations, as provided in the Divestiture Agency Agreement. 28. In the event the Commission appoints a Divestiture Agency, the Parties must, within the period prescribed by the Commission, grant a comprehensive and duly executed power of attorney in favour of the Divestiture Agency to effect the sale of Remedy Product(s) and all actions and declarations which the Divestiture Agency considers necessary or appropriate for achieving the sale of Remedy Product(s), including the power to appoint advisors to assist with the sale process. The power of attorney shall include the authority to grant sub-powers and the Divestiture Agency shall be given the sole authority to sell the Remedy Product(s). J. MONITORING ARRANGEMENTS 29. The Commission shall, under Regulation 27 of the Combination Regulations, appoint an independent agency as Monitoring Agency in terms of the General Regulations, for the purpose of, inter alia, supervision of the Modification. 30. The Monitoring Agency shall undertake such functions as may be directed by the Commission, which shall, inter alia, include the following functions: Combination Registration No. C-2025/07/1299 Page 32 of 33 (i) Overseeing the on-going management of the Remedy Products with a view to ensure its continued economic viability, marketability and competitiveness and monitor compliance by the Parties; (ii) Propose such measures to the Parties as the Monitoring Agency considers necessary to ensure Parties’ compliance with the Order; (iii) Review and assess potential purchasers as well as the progress of the licence / divestment process and verify that at each stage of the licence / divestment process, potential purchasers receive sufficient information relating to the Remedy Products and submit its recommendations as regards the suitability of the purchaser proposed by the Parties; (iv) Submit to the Commission a written report within fifteen (15) days after the end of every three (3) months, which shall cover the progress of the compliance by the Parties with the voluntary modifications provided in the Order. A non- confidential copy of the said report will be provided to the Parties; (v) Report immediately in writing to the Commission of any failure on the part of the Parties to comply with the Order; and (vi) Assume other functions assigned, under the monitoring agency agreement. 31. The Parties shall provide and cause their advisors to provide the Monitoring Agency with such cooperation, assistance and information as the Monitoring Agency may reasonably require to perform its tasks. 32. The Monitoring Agency shall have full and complete access to any of the books, records, documents, management or other personnel and technical information necessary for fulfilling its duties, to the extent the Parties can provide such access under applicable law. The Parties shall provide the Monitoring Agency with copies of any document required by the Monitoring Agency, as available with the Parties, upon request. Further, if required, the Parties shall make available one or more offices on their premises to the Monitoring Agency and provide the Monitoring Agency with all necessary information for the performance of their tasks, through meetings. The Parties Combination Registration No. C-2025/07/1299 Page 33 of 33 shall provide the Monitoring Agency with the managerial and administrative support that it may reasonably request. 33. Upon request, the Parties shall cause its advisors to provide the Monitoring Agency, with the information for reviewing the relevant documentation, information memorandum and in particular, give the Monitoring Agency access to all other information in the due diligence procedure, and keep the Monitoring Agency informed of all developments in the process. 34. The Parties shall indemnify the Monitoring Agency, its employees and agents and Divestiture Agency and its employees and agents and hold each of them harmless against any liabilities arising directly out of the performance of their duties under the Order, except to the extent that such liabilities result from the wilful default, recklessness, gross negligence or bad faith of the Monitoring Agency and/or Divestiture Agency, respectively. 35. The payment to the Monitoring Agency shall be made by the Acquirer.