FTC to allow $28B Amgen-Horizon merger

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Update:

• The Federal Trade Commission (FTC) announced it will allow pharmaceutical giant Amgen to continue with a $27.8 billion purchase of Horizon Therapeutics. 
• The decision is the result of an agreement between the FTC and Amgen that allows the company to avoid litigation over claims the merger was anticompetitive.
• The FTC had argued the purchase would allow Amgen to pressure insurance companies and pharmaceutical managers into favoring Horizon’s two monopoly products, Tepezza and Krystexxa. 
• Per the settlement, Amgen will need to get FTC approval prior to entering into any agreements related to business dealings for drugs that treat thyroid eye disease or chronic refractory gout. 

Amgen-Horizon merger overview: 

• Who: The Federal Trade Commission (FTC) filed a lawsuit to block Amgen Inc.’s proposed $27.8 billion purchase of Ireland-based drugmaker Horizon Therapeutics PLC. 
• Why: The FTC argues a merger between Amgen and Horizon would allow Amgen to “entrench the monopoly positions” of Horizon medication used to treat thyroid eye disease and chronic refractory gout. 
• Where: The merger would affect drug consumers nationwide. 

(May 30, 2023)

The Federal Trade Commission (FTC) is attempting to block a proposed $27.8 billion purchase of Ireland-based drugmaker Horizon Therapeutics PLC by American biotechnology company Amgen Inc.

In a lawsuit filed in federal court, the FTC says it is concerned a merger between Horizon and Amgen would allow the latter to “stifle competition for thyroid eye disease and chronic refractory gout treatments.” 

Amgen would be able to use its portfolio of blockbuster drugs as leverage to “entrench the monopoly positions” of Horizon medication used to treat thyroid eye disease and chronic refractory gout, the FTC claims.

The Horizon medications of concern are Tepezza, which is used to treat thyroid eye disease, and Krystexxa, which treats chronic refractory gout, according to the FTC. 

It also claims the deal would allow Amgen to use rebates on its existing blockbuster trades to pressure both insurance companies and pharmacy benefit managers into favoring Tepezza and Krystexxa. 

“Rampant consolidation in the pharmaceutical industry has given powerful companies a pass to exorbitantly hike prescription drug prices, deny patients access to more affordable generics and hamstring innovation in life-saving markets,” the FTC says in a statement. 

Amgen-Horizon merger would further limit competition for Tepezza, Krystexxa drugs, FTC says

The FTC argues the Am-Horizon merger would allow Amgen to effectively “deprive patients, doctors and health plans from the benefits of competition and access to critical new options for treatment of thyroid eye disease and chronic refractory gout.”

Horizon “boasted” in securities filings that its Tepezza drug has “no direct approved competition” and that Krystexxa “faces limited direct competition,” allowing it to charge “extremely high prices” for the medications, the FTC says.

Amgen, meanwhile, “has a history of leveraging its broad portfolio of blockbuster drugs to gain advantages over potential rivals,” according to the agency. 

In a statement last week, Amgen says it is “disappointed by the FTC’s decision” and that it “remains committed to completing this acquisition, which will bring significant benefits to patients suffering from very serious rare diseases in the U.S. and around the world.” 

Horizon, meanwhile, says it has “no plans to bundle any of its rare disease medicines,” and that it is “imperative” it continues to “advocate for access to innovative treatments for patients who may benefit, particularly in diseases with significant unmet needs.” 

The proposed acquisition was the largest in the pharmaceutical industry announced last year, according to the FTC. 

The FTC has moved to block mergers in the past.

In December, the FTC sought to block a proposed $69 billion merger between Activision Blizzard and Microsoft over concerns the agreement could harm competition in the gaming market. 

Do you agree with the FTC’s effort to block the Amgen-Horizon merger? Let us know in the comments.

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