EU poised to mandate Illumina sell Grail liquid biopsy unit: FT

Dive Brief:

The European Union will order Illumina to sell its liquid biopsy unit Grail, according to the Financial Times.
Quoting three anonymous sources, the FT reports that EU regulators could order the sale of the unit next week to punish Illumina for defying their authority and “illegally” acquiring Grail.
The order is unlikely to immediately resolve the long-running dispute, with Illumina reportedly prepared to appeal the decision as it works on both sides of the Atlantic to save the takeover.

Dive Insight:

Illumina has been braced for an order to sell Grail for more than a year. After Illumina closed the $8 billion takeover without receiving its blessing, the European Commission ruled in September 2022 that the deal was incompatible with the market. The ruling reflected a belief that the deal is a significant impediment to effective competition. In December 2022, the commission told Illumina it planned to order the sale of Grail.

Now, the next stage of the process is reportedly about to start. The timing of the ruling is uncertain, with the FT’s sources saying a divestment order could arrive next week but may slip to a later date. The report is clear about the outcome of the EU review though.

“They bought something illegally and now they need to sell it,” a person with direct knowledge of the matter told the FT. The anonymous quote is in line with public statements from EU bodies, which have fined Illumina 432 million euros ($457 million) and criticized it for “jumping the gun” on the takeover.

Illumina plans to appeal any order to sell Grail, and has openly discussed ways that it could retain the unit even if it receives a divestment demand, according to the FT. The genome sequencing giant is pursuing two lines of defense in the EU, working to get authorities to sign off on the takeover while also arguing in court that they lack the power to block the acquisition.

An Illumina spokesperson declined Tuesday to comment on the FT report.

The EU row is advancing in parallel to a similar situation in the U.S., where the Federal Trade Commission has told Illumina to sell Grail. Illumina is already challenging the U.S. order and said it has a “strong case.”