AstraZeneca clears final antitrust hurdle as $39B Alexion buy wins U.K. nod

AstraZeneca
Despite threats of antitrust actions, AstraZeneca is now set to wrap up its $39 billion acquisition of Alexion next week thanks to a go-ahead from U.K. regulators. (AstraZeneca)

Turns out, it was all but a false alarm for AstraZeneca. Despite threats of antitrust actions, the British drugmaker is now set to wrap up its $39 billion acquisition of Alexion Pharma next week.

Wednesday, AstraZeneca said the U.K.’s Competition and Markets Authority (CMA) has cleared the Alexion buyout without raising any antitrust concerns.

The go-ahead follows blessings from anticompetition authorities in the U.S. and EU and marks the final regulatory approval the company needs to seal the deal, which is now expected to close July 21.

The transaction, unveiled in December, gives AZ additional know-how in immunology and a presence in rare diseases.

The combination of Alexion offers an immediate boost to AZ’s top line thanks mainly to complement inhibitors Soliris and Ultomiris, which together brought in $1.37 billion in first-quarter sales. AZ also sees broad application of Alexion’s complement platform and other immunology technologies in various therapeutic areas—including oncology—to fuel future growth.

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Once the takeover completes, AZ is creating a rare disease unit bearing Alexion’s name with headquarter at the U.S. firm’s current location in Boston. The franchise will be led by Marc Dunoyer, currently AZ’s chief financial officer, who will also take on the title of chief strategy officer. His CFO role will be filled by Alexion’s CFO, Aradhana Sarin.

Industry watchers have been keeping a close eye on the progress of the deal for fear that it would become the poster child of tightened scrutiny at the now Democrats-led U.S. Federal Trade Commission (FTC). The extra concern arose earlier this year after the U.S. antitrust watchdog said it would take a more aggressive approach to regulating large biopharma deals.

But after AZ refiled the Alexion case, the FTC waved through the deal in April without erecting any roadblocks. Then the European Commission granted its permission for the deal last week.

The U.K. CMA launched its review of the deal in May. In giving its green light, the agency clearly doesn’t think the deal would hurt competition in any way.

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Future biopharma megadeals might not enjoy the same smooth regulatory journey as AZ and Alexion did. In a new executive order signed last week, President Joe Biden takes aim at anti-competitive practices in various business sectors, including healthcare. With eyes on lowering drug prices, the order calls on the Department of Justice and FTC to enforce antitrust laws “vigorously” and to consider revising their M&A guidelines.

Given how Democratic commissioners at the FTC had previously openly objected to large biopharma transactions such as that between Bristol Myers Squibb and Celgene, reforms look on the way.

“The current guidelines deserve a hard look to determine whether they are overly permissive. We plan soon to jointly launch a review of our merger guidelines with the goal of updating them to reflect a rigorous analytical approach consistent with applicable law,” FTC Chair Lina Khan and acting Assistant Attorney General Richard A. Powers said in a statement following the executive order.