The Federal Trade Commission (FTC) on Tuesday announced in a news release that, after a 4-0 vote among commissioners, it filed an administrative complaint against DNA-sequencing provider Illumina Inc. and multi-cancer early detection (MCED) test developer Grail Inc. over the companies’ proposed $7.1 billion merger.
The FTC alleged in its complaint that if Illumina — whose platforms produce more than 90% of DNA sequencing data worldwide — were to officially acquire Grail, it would “substantially lessen competition” in the market of MCED tests, “diminishing innovation and potentially increasing prices.”
According to the release, given Illumina is the only seller of next-generation sequencing (NGS) platforms compatible with MCED tests in the country, it has the power to raise prices for Grail competitors for its NGS technologies, impinge on the research and development of Grail competitors, and delay licensing agreements necessary for MCED test developers to get their tests into laboratories. The complaint argued that even if another company were to enter the market with a commercially viable platform able to compete with Illumina, the process for test developers to transition to another sequencing platform would be gradual.
With cancer being the second leading cause of death worldwide, and most cancers only being detected after experiencing symptoms, competition in the MCED test industry is necessary for continued innovation, the complaint contended.
“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 release. “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.”
The administrative complaint is seeking a temporary restraining order and preliminary injunction to halt the merger and the FTC also will file a complaint in the District of Columbia seeking the same outcomes pending an administrative trial set to begin Aug. 24, the release said.