As the Federal Trade Commission (FTC) scrutinizes two large biopharma mergers, the antitrust agency and the Department of Justice (DOJ) have laid out updated merger guidelines in a bid to slap down anticompetitive tactics in pharma and beyond.
Thirteen new guidelines should “expand and clarify” previously established frameworks in the government's review of M&A deals, the agencies said in a press release. The updates serve to “better reflect” how the agencies determine a proposed merger’s impact on competition, the two agencies added.
Under the new principles, mergers should not “significantly increase” concentration in highly concentrated markets, nor should they eliminate substantial competition between companies or increase the risk of coordination. They also shouldn’t eliminate a potential entry in a concentrated market or act to further a trend toward concentration.
Merger deals shouldn’t decrease competition by setting up a firm that controls products that its rivals might use nor “entrench or extend” a dominant position, the agencies said.
The FTC and the DOJ urge the public to provide feedback on the updates during a 60-day comment period.
For years, the FTC has been working to revamp its review process for merger deals. In 2021, former acting Chair Rebecca Kelly Slaughter revealed the agency’s plans for an “aggressive” approach to reviewing biopharma deals, noting it will work with the DOJ and other authorities to examine how past mergers played out.
The updated guidelines signal increased scrutiny that could affect how the industry conducts M&A deals.
Recently, two major biopharma deals have found themselves in the FTC’s crosshairs. In May, the antitrust watchdog moved to block Amgen’s proposed $27.8 billion buyout of Horizon Therapeutics with a lawsuit arguing Amgen’s history of drug bundling during payer negotiations makes it likely to leverage its product portfolio to “entrench the monopoly positions” of two Horizon drugs.
More recently, the FTC zoned in on Pfizer’s proposed Seagen merger. A few days ago, the regulator asked the companies for more information in the second round of documentation requests since the deal was announced in March.