Torrent Pharmaceuticals Limited

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% 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 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 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 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 medicines[^2]. 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 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 Markets. The analysis and findings of the Commission for each of the aforesaid eight (8) Horizontal FDF Market is detailed hereunder.