Organon & Co. disclosed in a regulatory filing that it has supplemented the proxy materials for its pending acquisition by Sun Pharmaceutical Holdings USA after a stockholder filed a lawsuit attempting to block the shareholder vote.
The company entered into a merger agreement with Sun Pharma on April 26, 2026, under which Organon would become a wholly owned subsidiary of Sun Pharma USA. A special meeting of Organon stockholders to vote on the merger is scheduled for July 23, 2026.
The Lawsuit
On July 6, 2026, a complaint was filed in the Superior Court of New Jersey, Mercer County Chancery Division, against Organon, its board of directors, Sun Pharma USA, and the merger subsidiary. The action, captioned Richard Delman v. Robert Essner, et al., alleges that certain disclosures in the definitive proxy statement filed on June 17 were materially incomplete and misleading. The complaint asserts violations of the New Jersey Uniform Securities Law and, under New Jersey common law, claims of negligent misrepresentation and concealment, general negligence, and civil conspiracy.
The plaintiff is seeking declaratory and injunctive relief that would prevent the defendants from proceeding with the stockholder vote unless Organon issues a supplemental proxy statement with additional disclosures. On July 13, the plaintiff filed a motion for a preliminary injunction to halt the special meeting. The court has not yet ruled on that motion.
The Company's Response
Organon stated that it believes the claims are without merit and that no further disclosure is required under applicable law. Nevertheless, the company elected to voluntarily supplement the definitive proxy statement to avoid the risk of the litigation delaying or adversely affecting the merger and to minimize the costs and uncertainties of litigation. The company explicitly denied any admission of liability or that the additional disclosures were legally required.
What the Supplement Adds
The supplemental disclosures add detail in several areas of the proxy statement. The company disclosed that during preliminary diligence in January 2026, Organon presented potential cost synergies preliminarily estimated at approximately $700 million across commercial, procurement, R&D, and corporate functions.
Additional context was provided about the board's February 3, 2026 meeting, where Goldman Sachs presented strategic alternatives including a merger of equals with an integrated specialty pharmaceutical company followed by a divestiture of the Established Brands and generics business. The board considered significant execution risks associated with those alternatives, including the need to identify suitable counterparties for multiple future transactions, before continuing to evaluate Sun Pharma's proposal.
The supplement also clarifies that certain reference data provided by Morgan Stanley, including publicly traded companies analysis, precedent transactions analysis, premia paid analysis, analysts' price targets, and historical trading range, were not considered part of the financial analyses underlying Morgan Stanley's fairness opinion but were provided as supplemental reference data for the board.
Additional financial details were added, including that the number of fully diluted outstanding shares as of April 24, 2026 was approximately 284.9 million, net debt as of March 31, 2026 was $7,530 million, and estimated Adjusted LTM EBITDA as of March 31, 2026 was $1,832 million.
Organon noted that as of the filing date it was not aware of other lawsuits challenging the merger, but acknowledged that additional lawsuits could be filed. The company previously faced securities fraud class action litigation in 2025 related to its dividend reset announcement, though that matter is separate from the current merger-related suit.