![](https://www.techtarget.com/rms/onlineimages/legal_g941378956_searchsitetablet_520X173.jpg)
Getty Images
FTC Challenges $7.1B Illumina-Grail Pharma Acquisition Deal
FTC alleges that the proposed pharma acquisition deal will diminish innovation in the US market for multi-cancer detection tests.
The Federal Trade Commission (FTC) recently filed an administrative complaint and authorized a federal court lawsuit to block Illumina’s $7.1 million pharma acquisition deal of cancer detection start-up, Grail.
In the complaint, FTC alleged that the proposed acquisition would diminish innovation in the US market for multi-cancer detection (MCED) tests.
Notably, Illumina is the only viable provider of DNA sequencing for MCED tests in the US.
This means that Illumina can raise prices charged to Grail’s competitors for next-generation sequencing instruments, impede Grail competitors’ research and development efforts, or refuse or delay license agreements that all MCED test developers need to distribute their tests to third-party laboratories, FTC said in its complaint.
Therefore, FTC said that even if a substitute to Illumina’s next-generation sequencing platform entered the market, it would take years for MCED test developers to switch to a platform other than Illumina’s.
This is because developers would have to alter their tests to work with the new next-generation sequencing platform, and sometimes, conduct new clinical trials.
Currently, the market for liquid biopsies in the US is nearly $30 billion, according to Cowen & Company estimates.
MCED tests have the ability to detect up to 50 types of cancer, most of which are not screened. Experts are hopeful that these types of tests could save millions of lives around the world.
“The vast majority of cancers, which account for about 80 percent of cancer deaths, are only detected after patients exhibit symptoms. That is often too late to treat effectively,” FTC Acting Chairwoman, Rebecca Kelly Slaughter, said in the announcement.
“The MCED 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,” Slaughter continued.
The commission vote to issue the administrative complaint and to authorize staff to seek a temporary restraining order and preliminary injunction was 4 to 0, FTC said.
The commission will file a complaint in the US District Court for the District of Columbia seeking a temporary restraining order and preliminary injunction to stop the deal pending an administrative trial.
The trial is scheduled to begin in August 2021.
In 2016, Illumina founded Grail, which was then spun out as an independent company powered by Illumina’s next-generation sequencing technology. The technology helps develop data science and machine learning to create cancer signals in the blood.
The technology supports MCED tests.
Last September, Illumina and Grail entered into a definitive agreement under which Illumina would acquire Grail to help create MCED tests using genomics and next-generation sequencing platforms.
Following FTC’s complaint, Illumina announced that it disagrees with and will oppose the FTC’s challenge to its acquisition of Grail.
Illumina will pursue its right to proceed with the transaction, the impact of which would accelerate the adoption of a breakthrough MCED blood test.
“Combining GRAIL’s innovative multi-cancer early detection test with Illumina’s experience and scale will enable more patients in both the United States and worldwide to garner access to GRAIL’s test faster,” Hans Bishop, chief executive officer of Grail, said in an official announcement.
“We continue to believe that together we could transform cancer care by catching more cancers earlier,” Bishop continued.
So far, Grail has raised nearly $2 billion to support its innovative technology platform and develop Galleri. An earlier version of Galleri was able to detect more than 50 cancer types, over 45 of which have no recommended screening in the US, an Illumina spokesperson explained.
Galleri is expected to launch commercially in 2021 as a multi-cancer, laboratory developed test for early cancer detection from blood.