- The Federal Trade Commission has ordered Illumina to divest its controversial acquisition of cancer test developer Grail.
- The commission said the deal would stifle competition and innovation in the US cancer market.
- The decision overturns an administrative judge’s September ruling that dismissed the FTC’s original challenge to the $7.1 billion deal.
Francis deSouza, Chief Executive Officer of Illumina Inc., during a panel session on day three of the World Economic Forum (WEF) in Davos, Switzerland on Thursday, January 19, 2023.
Stefan Wermuth | Bloomberg | Getty Images
The Federal Trade Commission on Monday ordered Illumina to divest itself of its controversial acquisition of cancer test developer Grail, saying the deal would stifle competition and innovation.
The decision overturns an administrative judge’s September ruling that dismissed the FTC’s original challenge to the $7.1 billion deal.
“The Commission determined that the acquisition would hamper innovation in the US market [multi-cancer early detection] testing while increasing prices and reducing the choice and quality of testing,” the FTC said in a press release.
Illumina said in a statement that it intends to appeal the FTC’s decision in federal court and seek an expedited decision.
The FTC’s order comes as the Grail deal faces opposition from European regulators. The EU’s executive body, the European Commission, blocked the acquisition of Illumina last year over similar concerns that it would hurt consumer choice and innovation.
Illumina said last month it had challenged the European Commission, arguing that the agency had no jurisdiction to block the merger between the two US companies.
The DNA sequencing company said Monday that the success of European Commission appeals and FTC decisions “would maximize value for shareholders.”
“It enables Illumina to expand the availability, affordability and profitability of the breakthrough Galleri test in the $44 billion multi-cancer screening market,” said Illumina, noting a Grail test product that screens for multiple cancers .
Illumina’s acquisition of Grail has sparked a backlash from another opponent, activist investor Carl Icahn. His opposition to the deal stems from Illumina’s decision to complete it without antitrust approval. Icahn launched a proxy fight last month to seek seats on Illumina’s board and urge the company to back out of the deal.
Icahn did not immediately respond to a request for comment.