Roche wraps up $4.3B Spark buyout as FTC thumbs-up ends antitrust ordeal

Roche
Roche's $4.3 billion Spark Therapeutics takeover won U.K. and U.S. antitrust clearances and collected enough tendered shares all on the same day, putting an end to months of delays and speculations. (Roche)

That was, well, quick. Hard on the heels of a U.K. go-ahead, the U.S. antitrust watchdog has doled out its own blessing for Roche’s $4.3 billion takeover of Spark Therapeutics.

With all gears turning Monday, Roche also collected enough shares of the gene therapy specialist to close the transaction. Extension no more, the Swiss drugmaker already wrapped everything up Tuesday, as Spark now operates as a standalone company within the group.

The Federal Trade Commission’s (FTC's) clearance came after an extensive, 10-month investigation after the deal went public in February. Its final arrival, with a 5-0 vote from the commissioners, could ease concerns that the agency has adopted a more stringent framework for evaluating anticompetitive factors in biopharma mergers and acquisitions.

As widely speculated in the Roche-Spark case, the probe ended after evidence “did not indicate that Roche would have the incentive to delay or terminate Spark’s developmental effort for its hemophilia A gene therapy, or that the acquisition would affect Roche’s incentives regarding Hemlibra,” the FTC explained in a statement (PDF).

While hem A patients have traditionally received factor VIII replacement therapy, Roche’s Hemlibra, a relatively new antibody drug, has been quickly seizing market share, growing on a trajectory that could make it the leading therapy for the bleeding disorder. Sales of the drug reached CHF 386 million ($393 million) in the third quarter, up 22% versus the previous three months.

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Gene therapies, such as Spark’s investigational SPK-8011, could be the next big thing in hem A treatment, representing a threat to Hemlibra’s future with the potential to even cure the disease in a single shot.

However, as the FTC itself noted, Spark is only one of several companies developing gene therapies for hem A. BioMarin Pharmaceutical’s rival drug valoctocogene roxaparvovec, for example, is already under accelerated review by the European Medicines Agency, and analysts view it as an even better option than SPK-8011.

That was why industry watchers were scratching their heads when Roche in June unveiled an investigation by the U.K.’s Competition and Markets Authority and a rare “second request” by the FTC for more information. As a result, Roche was forced to extend the tender offer deadline multiple times and had to push back its expected deal closure date from the third quarter to the end of the year.

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Indeed, “[a]s the other companies endeavor to bring their gene therapies to market, Roche would have the incentive to accelerate, rather than decelerate the development of Spark’s gene therapy in order to compete for gene therapy patients,” the FTC said.

Ensuring a future for its hemophilia franchise and betting on gene therapy technology in general as a key next-generation therapeutic modality are the very reasons Roche CEO Severin Schwan cited to explain the deal’s rationale. Besides hemophilia, Spark is also the developer of Luxturna, the first FDA-approved gene therapy, greenlighted to treat a rare inherited retinal disease.

With a nod from the FTC, the pair has won all necessary antitrust approvals. By Monday, Roche said about 60.4% of Spark’s outstanding shares had been tendered, more than the 50% it needed. Now, Schwan has finally delivered on his promise to take in Spark by year-end.

Editor's Note: The story has been updated to reflect that Roche has closed the deal on Tuesday.

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