The Federal Trade Commission will seek to stop Illumina Inc’s $7.1 billion proposed acquisition of cancer detection test maker Grail Inc, the agency said in a statement on Tuesday.
Shares of Illumina fell 5.2% on Tuesday to $373.88.
The agency said the deal would slow innovation for tests that are designed to detect multiple kinds of cancer. Illumina, a life sciences company, was the only U.S. company to provide DNA sequencing for multi-cancer early detection tests, the FTC said. Grail makes a non-invasive, early detection biopsy test to screen for many kinds of cancers using DNA sequencing, the agency said.
Grail has developed a test called Galleri, which is currently available only to participants in clinical studies, according to the company’s website.
“Illumina will vigorously defend its acquisition of Grail because we strongly believe it is in the best interest of patients,” spokeswoman Karen Birmingham said in a statement.
Birmingham also said that Illumina was “continuing to offer contractual guarantees of equal and fair access to sequencing for six years after the close of the acquisition.” She also said that Illumina had made a commitment to lower prices by more than 40% by 2025.
Illumina said in September that it would acquire Grail, buying out investors including Amazon.com Inc founder Jeff Bezos and snatching back a business it spun out four years ago. Illumina had remained the company’s largest shareholder.
The FTC commissioners voted 4-0 to challenge the deal.
“The (multi-cancer early detection) test is a game changer for cancer patients and their loved ones. If this acquisition is consummated, it would likely reduce innovation in this critical area of healthcare, diminish the quality of MCED tests, and make them more expensive,” said FTC acting Chairwoman Rebecca Kelly Slaughter.
Source: Reuters.com