Illumina ordered to divest Grail by FTC on anticompetition concerns

Dive Brief:

DNA-sequencing provider Illumina has been ordered by the Federal Trade Commission to divest Grail, maker of a multi-cancer early detection (MCED) test, after finding that the deal would stifle competition and innovation in the U.S. market for life-saving cancer tests.
The agency’s opinion today reverses an administrative law judge’s initial decision that dismissed the antitrust charges in a complaint brought by FTC staff.
San Diego-based Illumina said in a statement that it will appeal the FTC’s decision.

Dive Insight:

Illumina bought Grail for $7.1 billion in 2021 while still facing antitrust challenges from U.S. and European regulators. The company also is under pressure from activist investor Carl Icahn, who is urging it to end its fight with regulators and divest the business.

The FTC said the acquisition likely will substantially reduce competition in the U.S. market for research, development and commercialization of the tests.

Grail makes early-detection liquid biopsy tests that can screen for multiple types of cancer at very early stages using DNA sequencing.

Illumina is the dominant producer of next-generation sequencing platforms used to analyze genetic material from the blood samples drawn for MCED tests. Most of the cancer types for which the test can be used are not screened for today.

The FTC found that the acquisition would diminish innovation in the U.S. market for MCED tests, while increasing prices and decreasing choice and quality of tests.

“This is extremely concerning given the importance of swiftly developing effective and affordable tools to detect cancer early,” the FTC said in a statement.

The agency noted Illumina is the only viable supplier of platforms necessary for MCED tests.

The FTC said Illumina gave Grail special pricing and other benefits.

“Real world evidence of Ilumina’s past behavior reinforces the Commission’s antitrust concerns,” the commission said. The regulator said it rejects Illumina’s claim that this acquisition will likely yield results that save lives.

Illumina said it intends to file a petition for review promptly with a U.S. Court of Appeals and will seek expedited treatment of the appeal. The FTC's order to unwind the acquisition will be automatically stayed pending appeal.