Bayer’s Acquisition Of Monsanto Company (NYSE:MON) Approved By U.S. Justice Department
Due to the size of the deal, Bayer and Monsanto will have to get regulatory approval in 30 countries. Just last month the two companies obtained antitrust approval in Europe. Regulatory approval was also expected in the United States since the chief executive officers of Monsanto and Bayer, Hugh Grant and Werner Baumann, had paid a visit to the then president-elect Donald Trump after which they said their meeting had been highly productive. At the time Grant and Bauman disclosed that Trump had agreed with them that there was a need for innovation in the agricultural sector.
Large market share
The deal is expected to result in a firm which will possess a share of over 25% of the pesticides and seed market in the world. Due to the souring of the global farm economy, there has been consolidation among major players in the sector and this triggered protests from farming and environmental groups who are harboring fears and worries over the monopolistic market power that will be wielded by the resulting entity.
The deal is expected to reduce competition with regards to the sales of chemicals and seeds to farmers who are already struggling with depressed prices for their produce. According to the executive director of the advocacy group Food & Water Watch, Wenonah Hauter, this has increased the risk of price gouging.
“The Justice Department’s paltry divestment approach does little to address the extreme control the merged firm will have over farmers’ data, genetics, biotechnology traits or the associated agrichemical industry,” said Hauter.
Permanent contraception
The approval by the Justice Department of the deal coincides with the U.S. Food and Drug Administration restricting the sale of Essure, a permanent contraception device developed by Bayer. According to the Food and Drug Administration, this is to ensure that the women who want to use the product have information at their disposal concerning Essure’s risks as well as benefits.
The directive by the U.S. Food and Drug Administration will now see sales of Essure restricted to healthcare facilities and doctors who will offer a brochure that is specific to a patient and which contains information on the risks that the device poses. Some of the risks of Essure include perforation of fallopian tubes and the uterus, allergic reactions and pain. The device has also been known to migrate to different parts of the body.
According to the Food and Drug Administration, patients will be afforded an opportunity of signing the document and the physician implanting it must also sign. The responsibility of ensuring compliance by the healthcare providers will rest with Bayer. Failure to comply will lead to drastic action including civil and criminal penalties. On the market, Essure is currently the lone contraception device that is permanent and which does not need a surgical incision.
This article was originally posted on FX Empire
