Illumina Wins FTC Antitrust Case, Then Gets $8B Grail Acquisition Blocked by EU

Illumina’s $8 billion acquisition of the blood testing company Grail was recently blocked by European regulators just days after the company had defeated a similar challenge by the FTC.

According to the European Commission, the acquisition would have “stifled innovation, and reduced choice” in the rapidly growing blood-based cancer screening test market. The EC argued that the deal would give Illumina an unfair advantage over its rivals because other companies rely on its NGS systems technology for their own products.

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“With this transaction, Illumina would have an incentive to cut off Grail’s rivals from accessing its technology, or otherwise disadvantage them,” said European Commission Executive Vice President Margrethe Vestager. “It is vital to preserve competition between early cancer detection test developers at this critical stage of development.”

Illumina responded by saying that it will appeal the decision. “As we continue to believe, this merger is pro-competitive and will accelerate innovation,” said Illumina general counsel Charles Dadswell.

Prior to the EU decision and perhaps anticipating pushback, Illumina had said that in the event of a divesture order, it would begin looking at “strategic alternatives” for Grail.

The Grail acquisition has been a long-running saga for Illumina. Originally, Grail was launched out of Illumina in 2016. Then, in September 2020, Grail announced plans to put together a potentially massive IPO, before Illumina came in with a buyout and re-acquisition offer a few weeks later.

Prior to the EU’s decision, it was already furious with Illumina, which had completed the merger against its objections in August of last year. The EU had specifically ordered Illumina to keep Grail entirely separate until a final decision could be reached, but Illumina decided to go ahead with the deal anyway.

Illumina fared much better across the Atlantic. U.S. courts gave Illumina permission to merge earlier in September after an FTC lawsuit did not persuade judges. While the FTC said at the time that it planned to appeal the ruling, now that the EU has blocked the merger altogether on its end, the only thing that appears certain is that Illumina will appeal the EU’s decision.