Mergers: Commission partially refers acquisition of a part of McKesson by Phoenix to France’s competition authority and clears proposed merger outside France

Mergers: Commission partially refers acquisition of a part of McKesson by Phoenix to France’s competition authority and clears proposed merger outside France

The European Commission has partially referred the proposed acquisition of a part of McKesson by Phoenix to the French competition authority (‘Autorité de la concurrence’), at its request. The Commission has approved unconditionally, under the EU Merger Regulation, the proposed transaction outside France. The Commission concluded that the transaction would raise no competition concerns in other markets in the European Economic Area (‘EEA’).

Phoenix and McKesson are active in the wholesale and retail distribution of pharmaceutical goods in several European countries.

On 9 February 2022, Phoenix notified the acquisition of a number of McKesson’s portfolio companies, together with McKesson’s wound care business in Germany as well as other European assets. On 23 February 2022, the Autorité de la concurrence requested that the Commission refers to it the assessment of the proposed transaction in relation to France. The Autorité de la concurrence put forward competition concerns in a number of markets in France, notably the markets for wholesale distribution of pharmaceutical goods. In addition, the Autorité de la concurrence claimed that it would be well placed to review the competition effects in France in view of its knowledge and expertise handling previous similar cases.

The Commission’s investigation

The evidence gathered by the Commission confirmed that the proposed acquisition threatens to affect significantly competition in the markets for wholesale pharmaceutical distribution in France, where McKesson and Phoenix are currently the first and the fifth largest competitors, respectively. The Commission therefore decided to partially refer the transaction to the French Autorité de la concurrence, which will deal with the case under national competition law.

At the same time, the Commission has approved, under the EU Merger Regulation, the remaining part of the transaction. In particular, the Commission assessed in detail, the markets for wholesale and retail distribution of pharmaceutical products in Italy where the transaction gave rise to affected markets. The Commission concluded that, besides France, the proposed transaction would not raise competition concerns. On this basis, the Commission cleared the transaction outside France, under the normal merger review procedure, in view of parties’ limited market shares and the limited increment resulting from the transaction.

Companies and products

Phoenix, based in Germany, is ultimately controlled by Phoenix Pharma SE, which operates as an integrated healthcare provider mainly in Germany, but also other European countries. Phoenix’s core business is the wholesale and retail distribution of pharmaceutical goods in 14 European countries.

McKesson, based in Germany, is a pharmaceutical wholesale and retail company providing logistics and services in the healthcare sector in 12 European countries. McKesson is a part of McKesson Europe Holdings GmbH & Co, KGaA and it is ultimately controlled by McKesson Corporation, based in the United States of America.

Merger control rules and procedures

The Commission has the duty to assess mergers and acquisitions involving companies with a turnover above certain thresholds (see Article 1 of the EU Merger Regulation) and to prevent concentrations that would significantly impede effective competition in the EEA or any substantial part of it.

The vast majority of notified mergers do not pose competition problems and are cleared after a routine review. From the moment a transaction is notified, the Commission generally has a total of 25 working days to decide whether to grant approval (Phase I) or to start an in-depth investigation (Phase II). The Commission’s Phase I deadline is extended to 35 working days in cases where a national competition authority formally requests a referral under Article 9 of the EU Merger Regulation, such as in this case.

According to Article 9(2)(a) of the EU Merger Regulation, the Commission may refer a transaction notified to it to the competent national competition authority, when a Member State requests such a referral because a transaction would threaten to significantly affect competition in a market within that Member State and that market presents all the characteristics of a distinct market.

A non-confidential version of today’s decision will be available on the competition website, in the Commission’s public case register under the case number M.10404.

Source: Mergers: Commission partially refers acquisition (

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