The Federal Trade Commission on Tuesday said it has sued to block Amgen‘s $27.8 billion acquisition of Horizon Therapeutics.
Shares of Horizon were down 15% in morning trading. Amgen’s stock dropped about 1%.
The FTC argued that the deal would allow Amgen to “entrench the monopoly positions” of two of Horizon’s fast-growing medications: the thyroid eye disease treatment Tepezza and the gout medicine Krystexxa.
Neither drug has any competition in the pharmaceutical market, the agency noted.
Amgen will specifically be able to offer rebates on its existing drugs to pressure insurers and pharmacy benefit managers into favoring the two Horizon products, the FTC said. The agency claimed Amgen has a history of leveraging its drug portfolio to gain advantages over potential rivals.
“Today’s action – the FTC’s first challenge to a pharmaceutical merger in recent memory – sends a clear signal to the market: The FTC won’t hesitate to challenge mergers that enable pharmaceutical conglomerates to entrench their monopolies at the expense of consumers and fair competition,” FTC Bureau of Competition Director Holly Vedova said in a press release.
Amgen said in a statement it was “disappointed” by the FTC’s decision.
The company “remains committed to completing this acquisition, which will bring significant benefits to patients suffering from very serious rare diseases in the U.S. and around the world.”
Amgen added it has been working “cooperatively” to answer questions raised by the FTC’s investigative staff over the past several months. The company believes it has “overwhelmingly demonstrated” that the merger poses no competitive issues.
Amgen intends to work with the federal court on a schedule that would allow the deal to close by mid-December.
A representative for Horizon Therapeutics did not immediately respond to a request for comment from CNBC. Bloomberg earlier reported the lawsuit could come on Tuesday.
Robert Galbraith | Reuters
The two drugmakers said in February that the…
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