UPDATE 1-Novartis AG wins approval to buy GSK cancer drugs, with conditions

Mon Feb 23, 2015 12:34pm EST
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(Adds Canada approving deal, details on divestitures, background on three-way deal)

WASHINGTON Feb 23 (Reuters) - Novartis AG has won U.S. antitrust approval to buy GlaxoSmithKline's oncology drugs, with conditions, the U.S. Federal Trade Commission said on Monday.

Canada's competition agency also said on Monday that it would allow the deal to go forward.

To win U.S. approval for the $16 billion deal, Novartis agreed to divest assets related to its BRAF and MEK inhibitor drugs, now in development to fight melanoma, the FTC said.

The deal is one of three related transactions announced in April 2014 in which GlaxoSmithKline would buy Novartis' global vaccine business, except for flu vaccines, Novartis would buy Glaxo's cancer drugs and the two companies would combine to create a consumer healthcare business.

With Monday's approval, the FTC has given the green light to all three portions of the deal.

Array BioPharma Inc, which is based in Colorado, has agreed to purchase the inhibitor drugs, the U.S. agency said.

The FTC said the divestiture was needed because Glaxo and Novartis were among a small number of companies that sell or are developing the inhibitors. (Reporting by Diane Bartz; Editing by Kevin Drawbaugh and Dan Grebler)