Brazil's Administrative Council for Economic Defense ( Cade ) has begun reviewing the acquisition of the pharmaceutical company Medley by EMS . The Sanchez family's company announced in early March the purchase of the Brazilian generics unit of the French company Sanofi for approximately US$600 million.
The official acquisition will be made by Novamed, one of the companies in the NC group, which controls EMS. The public notice, confirming the start of the analysis, was published in the Official Gazette of the Union (DOU) on June 1st, and signed by the deputy superintendent Felipe Neiva.
In the 126-page notification form sent to Cade – which NeoFeed had access to – the pharmaceutical company confirms that the M&A will result in an overlap of approximately 40 therapeutic classes of medications. However, it states that this will not cause excessive market concentration.
According to the two companies, despite the horizontal overlap in much of their drug portfolio, the structure of the Brazilian generic drug market is very fragmented and would prevent the new company from having excessive influence in the Brazilian pharmaceutical market.
Precisely because they understand that there is a certain degree of complexity in the negotiation, even though they say there is no chance of changing the competitive landscape of the sector, EMS and Sanofi filed for ordinary proceedings, in which the analysis takes a little longer than the summary procedure. The deadline, in this case, is 240 days (eight months).
One point raised by the acquired company is that, in practice, even if it could, the company would not have the power to implement a possible price increase because the market is regulated by the Chamber for the Regulation of the Medicines Market (CMED), an agency linked to the National Health Surveillance Agency (Anvisa).
"CMED itself provides mechanisms to curb any potential exercise of market power, restricting any possibility of discretionary price increases after the consolidation of this operation," the document states.
Among the therapeutic classes in which both EMS and Medley offer generic medications, the document lists, among the most relevant, the cardiovascular, diabetes, gastrointestinal, dermatological, gynecology, urology, antibiotic, psychiatry, and neurology segments, among others.
Although the company acknowledges in its report that there are markets where the combined market share exceeds 40%, it explains that when alternative treatments are considered, this concentration decreases and competition remains strong. In practice, the company says there are many other treatment options available at pharmacies.
One of the most sensitive markets mentioned in the document is that of hydroxychloroquine, a drug that became very well-known during the Covid-19 pandemic because it was even listed by some doctors as an indication for the "early treatment" of the disease - something that has never been scientifically proven.
The drug, which is used to treat diseases such as malaria and others like rheumatoid arthritis, is one of those with a concentration exceeding 40%, along with products from both companies. However, according to the company, the drug competes with other possible treatments.
Another listed medication, with extensive explanation, is naratriptan, used for migraines. EMS's argument is that there are several ways to combat the disease, with various therapeutic classes, depending on the medical prescription.
Of the 27 markets in the retail channel and 14 in the institutional channel (public sector) identified by EMS as having overlap, 19 of them fall below 40%, according to the company.
In the document, EMS also states that the negotiation includes a manufacturing unit in Campinas, São Paulo, comprised of two properties, in addition to the intellectual property and trademark rights of Medley's products.
With the acquisition confirmed, the Brazilian pharmaceutical company will also inherit Medley's distribution contracts operated by third parties in the states of São Paulo and Minas Gerais.
"For the NC Group, the operation represents a good opportunity to expand its offering of generic medicines. In turn, for the Sanofi Group, the operation is aligned with its global strategy of focusing its efforts on innovative products and enabling its sustainable and profitable growth," the company says in the document.
To justify the claim that the change in Medley's leadership will not alter the generic drug market in Brazil, EMS cites a series of investments announced by competitors in recent months.
Among them, the company cites Cimed 's R$ 450 million investment in the construction of a factory in Pouso Alegre, Minas Gerais; Eurofarma 's new industrial complex, also in Minas Gerais, with investments of R$ 2 billion; and a factory for oncology drugs, owned by Hypera, which cost R$ 363 million; among other investment cycles.
In one of the documents in the proceedings opened at Cade (Brazil's antitrust agency), EMS reports that there are at least 30 large pharmaceutical groups that operate significantly in the generic drug market in Brazil.
Among the most cited in the document are Eurofarma, Aché, Hypera Pharma, Prati-Donaduzzi, Teuto, Cimed, Geolab, União Química, Biolab, Vitamedic, as well as other companies in the sector.
Data from the Brazilian Association of Generic and Biosimilar Drug Industries (PróGenéricos) confirms the thesis presented by the Sanchez family's company. The seventh largest pharmaceutical market in the world, the generics sector generated R$ 23 billion in revenue in 2025, representing a 13.4% increase over the previous year.
Over the past five years, the volume of generic drugs in Brazil has grown by 75%. Of all medications sold in the country, 40% are generics, with an average discount of 70%.
According to ProGenéricos, there are currently 102 laboratories producing medications in Brazil, with 4,665 presentations registered with Anvisa (the Brazilian Health Regulatory Agency). On average, more than 2.5 billion boxes of medicines are sold annually.
