FTC orders Illumina to divest Grail acquisition
Francis deSouza, chief govt officer of Illumina Inc., throughout a panel session on day three of the World Financial Discussion board (WEF) in Davos, Switzerland, on Thursday, Jan. 19, 2023.
Stefan Wermuth | Bloomberg | Getty Photographs
The Federal Commerce Fee on Monday ordered Illumina to divest its controversial acquisition of most cancers check developer Grail, saying the deal would stifle competitors and innovation.
The choice reverses an administrative choose’s September ruling, which dismissed the FTC’s preliminary problem of the $7.1 billion deal.
“The Fee discovered that the acquisition would diminish innovation within the U.S. marketplace for [multi-cancer early detection] exams whereas rising costs and reducing selection and high quality of exams,” the FTC stated in a press launch. “That is extraordinarily regarding given the significance of swiftly creating efficient and reasonably priced instruments to detect most cancers early.”
Illumina stated in a press release that it intends to enchantment the FTC’s determination in federal courtroom and can search an expedited determination.
The FTC’s order comes because the Grail deal faces opposition from European regulators. The EU’s govt physique, the European Fee, final yr blocked Illumina’s acquisition over related considerations that it might harm client selection and innovation.
Illumina stated final month it has challenged the European Fee, arguing the company lacks jurisdiction to dam the merger between the 2 U.S. firms.
The DNA sequencing firm on Monday stated successful appeals of the European Fee and FTC choices would “maximize worth for shareholders.”
“It allows Illumina to develop the supply, affordability and profitability of the groundbreaking Galleri check within the $44-plus billion multi-cancer screening market,” Illumina stated, referencing a Grail check product that screens for a number of cancers.
Illumina’s acquisition of Grail has sparked backlash from one other opponent in activist investor Carl Icahn. His resistance to the deal stems from Illumina’s determination to shut it with out approval from antitrust regulators. Icahn launched a proxy combat final month, looking for seats on Illumina’s board of administrators and urging the corporate to unwind the deal.
Icahn didn’t instantly reply to a request for remark.
