In order to settle Federal Trade Commission charges that a proposed asset swap with Sanofi would be anti-competitive Boehringer Ingelheim has agreed to divest several animal health products in the United States.

The FTC announced the agreement Wednesday.

As we previously reported, Boehringer announced in November asset swap plans with Sanofi. The FTC said under the proposed swap, Boehringer will acquire Sanofi’s animal care subsidiary, Merial, valued at $13.53 billion, and Sanofi will obtain Boehringer’s consumer health care business unit, valued at $7.98 billion, as well as cash compensation of $5.54 billion.

However, the FTC filed a complaint alleging that without Boehringer divesting its animal health products the asset swap would harm competition in the U.S. markets for various vaccines for pets and certain parasite control products for cattle and sheep.  The transaction would also lead to higher prices and reduced services in the markets.  Under the proposed consent order Boehringer will divest the companion animal vaccines to Eli Lilly and the company’s Elanco Animal Health division, and the parasite control products to Bayer AG.

Earlier this month, Bayer announced it signed an agreement to acquire Boehringer’s CYDECTIN bovine and ovine endectocide products.

“This transaction underlines our strategy to strengthen our portfolio with bolt-on acquisitions,” said Dr. Dirk Ehle, Head of Bayer Animal Health. “The U.S. is our most important market, and the addition of the CYDECTIN products will help further strengthen our position in cattle parasiticides in the U.S.”

According to the FTC to ensure the consent order is achieved Boehringer is required to provide technical assistance and other transition services so the companies can independently manufacture and sell the products. The FTC order also includes an asset maintenance order and it appoints a monitor to oversee the divestiture process.

CLICK HERE to read the FTC release on the divestitures conditions.