The U.S. Federal Trade Commission's decision on Friday to allow Amgen's takeover of Horizon Therapeutics was the latest setback to its stated goal of stricter antitrust enforcement, and instead paved the way for Amgen to gain drugs not subject to new price negotiations and possibly lower the company's tax burden.
The move signals the FTC's uncertainty that a court would support its novel theory of future competition being disadvantaged by Amgen's "bundling" of drugs in negotiations with insurers.
"I think there is some skittishness on whether to pursue this and develop new case law," said Abiel Garcia, a partner at Kesselman, Brantly & Stockinger and a former deputy attorney general in California's antitrust department.
Until Friday's settlement, the case was scheduled to go before U.S. District Judge John Kness, who was nominated to the court by former President Donald Trump.
Federal antitrust authorities "may be reassessing their position given the recent slate of judicial decisions," Garcia said. "They really didn't get the traction they expected."
The FTC in July abandoned its bid to block Microsoft's $69 billion deal to buy Activision Blizzard, after earlier losing a fight to stop Meta Platforms from buying virtual reality content maker Within Unlimited.
Amgen's acquisition of Horizon was the first biotech deal challenged since the FTC's 2021 launch of a pharmaceutical merger task force, which has been followed by workshops designed to explore concerns over increased industry consolidation.
The settlement "is likely a win for Amgen," which will avoid any potential break-up fee payment, said Evan Seigerman, a senior research analyst at BMO Capital Markets.
With Horizon, Amgen acquires drugs that won't be affected by new U.S. negotiation requirements for blockbuster medications as well as possible tax advantages stemming from Horizon's headquarters in Ireland.
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