Mayne Pharma Collapses 30% as Treasurer Flags National-Interest Block in Cosette Deal

Mayne Pharma in Freefall: Regulatory Hurdle Threatens $672 m Buy-out

Mayne Pharma (ASX: MYX) has suddenly become one of the most talked-about stocks on the ASX after the federal Treasurer raised serious national-interest concerns about its proposed takeover by Cosette Pharmaceuticals. The company that looked like it was on the cusp of being acquired is now facing a major regulatory roadblock in a high-stakes drama that pits jobs, local manufacturing and M&A dynamics against one another. For investors watching from the sidelines this could be a turning point: a familiar name in pharmaceuticals at a moment of inflection.

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Regulatory Roadblock Puts Mayne Pharma Deal in Doubt

In recent weeks the sharp sell-off in Mayne Pharma shares reflects a sudden escalation of regulatory and execution risk. First, the extended review by the Foreign Investment Review Board (FIRB) and the Treasurer’s preliminary indication that the deal may be “contrary to the national interest” have dramatically reduced the odds of the acquisition proceeding on the original terms.

Beyond that, the pending deadline mismatch in the Scheme Implementation Deed means that if the review drags on or approval is not granted by the prescribed date, the deal could automatically collapse, leaving Mayne to execute as a standalone business. That pivot alone introduces a meaningful risk of value destruction in the near term.

Beneath the Sell-Off, Mayne Pharma Still Holds Strategic Value

On the flip side, Mayne Pharma retains a set of structural strengths that underpin its longer-term thesis. Its Adelaide manufacturing facility is approved by both the Therapeutic Goods Administration (TGA) and the Food and Drug Administration (FDA), was recently upgraded with roughly AUD $18 million invested (including a AUD $4.8 million federal grant) and represents a strategic manufacturing asset in Australia’s pharmaceutical ecosystem.

If Mayne can pivot effectively without the takeover premium being realised it still has the ability to grow through its contract-manufacturing operations and leverage its niche in dermatology and women’s health (especially in the U.S.). That structural optionality is part of the reason some investors may view the current share price weakness as an opportunity rather than a collapse.

Mayne Pharma Faces a Binary Bet: Recovery or Further Downside

Putting this together, we believe the situation presents a “binary outcome” scenario for investors. On the upside, if the FIRB review is resolved favourably, the acquisition could proceed (or a new deal emerges), unlocking the takeover premium and validating Mayne’s strategic position. On the downside, if approval is withheld or the deal collapses the company will face two key risks: execution risk as a standalone entity and the absence of the deal premium that many investors had priced in. We therefore see a mixed risk-reward profile.

We recognise the structural value in Mayne’s manufacturing capability, global niche, and underlying business, but there is clear regulatory and execution risk ahead. As investor,s we need to weigh whether the present share price already reflects a “worst-case” outcome or whether there is further downside.