Amgen-Horizon Merger Clearance a Setback to FTC’s Antitrust Enforcement Plans

FTC Building_iStock, bpperry

Pictured: U.S. FTC building in Washington, DC/iStock, bpperry

In a settlement on September 1, the U.S. Federal Trade Commission cleared Amgen to proceed with its $27.8 billion acquisition of Horizon Therapeutics after several months of scrutiny. Some experts say the agreement is a setback for the agency.

The Federal Trade Commission (FTC’s) decision to settle the Amgen/Horizon case through a “behavioral remedy” is the latest in a series of setbacks to the regulator’s stated goal of stricter antitrust enforcement, a notable decision with significant implications for ongoing and future FTC M&A challenges, according to two antitrust lawyers who spoke to BioSpace

“This decision by the FTC appears to be a recognition on the part of the FTC that it faced an uphill climb to persuade a district court judge to block the transaction outright on a novel legal theory of harm,” said Jeny Maier, an antitrust partner at Axinn, Veltrop & Harkrider LLP.

“[It] is notable because of [FTC] Chair [Lina] Khan’s vocal critiques of behavioral remedies’ effectiveness in addressing harms from mergers,” Maier added. “Indeed, she testified before the Senate last year saying, ‘We now strongly disfavor behavioral remedies.’”

The FTC’s Case

The Amgen-Horizon buyout, announced in December 2022, was halted in May 2023 due to a lawsuit filed by the FTC over concerns that the acquisition might suppress competition. In an unusual twist for merger challenges, the agency’s case against Horizon and Amgen did not hinge on claims of competing products or potential future competition. Instead, the focus was on the potential for Amgen to include Horizon's blockbuster drugs in its rebate program.

The FTC’s complaint centered on two Horizon products: Tepezza and Krystexxa. Tepezza is the only FDA-approved treatment for thyroid eye disease (TED), while Krystexxa is the sole FDA-approved product for chronic refractory gout (CRG). 

Despite facing little to no competition, the FTC argued that Horizon anticipated increased competition from clinical-stage rivals in the near future. Given its substantial biopharmaceutical portfolio, including nine products with over $1 billion in sales each in 2022, the FTC’s concern was that the acquisition could shield Horizon from this anticipated competition.

Amgen, on the other hand, has argued consistently that its acquisition of Horizon is only an opportunity to expand its rare disease portfolio and that it has no plans as to stifle market competition. To formalize these assertions, Amgen has agreed to enter into an FTC consent order agreement that prohibits it from bundling any of its products with either Tepezza or Krystexxa, among other requirements. 

Following an executive order in July 2021, the Biden administration has taken a more aggressive approach to antitrust enforcement, with both the FTC and the Department of Justice pursuing cases to address competition issues in various sectors, including the pharmaceutical ecosystem, which has been a major target of late. 

On August 25, the U.S. Court of Appeals for the District of Columbia Circuit dismissed an FTC lawsuit alleging that an agreement between Endo Pharmaceuticals and Impax Laboratories for the opioid Opana ER (oxymorphone extended release) violated antitrust law. 

In dismissing the FTC’s claim against the pharmaceutical companies, the court cited insufficient factual allegations to support the lawsuit. 

George Gordon, a partner at Dechert LLP who argued the appeal for Endo, said in a statement that this ruling is “particularly significant in an antitrust enforcement environment that has become increasingly hostile to, and suspicious of, the exercise of patent rights.”  

Going Forward: What to Expect

“The outcome in [the Amgen case] provides further support for merging parties’ strategy of making unilateral commitments to defuse the harms claimed by the FTC or DOJ,” Maier said. 

She further added that Amgen’s successful use of this strategy follows a similar path as in Illumina/Grail and Microsoft/Activision Blizzard. In both cases, the FTC initially lost its challenge and both are currently in appeal. 

This could indicate that the FTC may be looking for similar conduct remedies in future pharmaceutical deals even when the claimed competitive harm is less than clear, Jonathan Lewis, an antitrust partner at Lowenstein Sandler LLP, told Biospace

Notwithstanding the FTC’s acceptance of a settlement in the Amgen/Horizon matter, dealmakers in the pharmaceutical sector should continue to expect the FTC to explore novel theories of harm in merger investigations, Maier said. 

As highlighted in Chair Khan’s written statement accompanying the Amgen settlement announcement, Maier said the FTC is very focused on digging deeper into pharmaceutical markets to understand connections between mergers and drug company conduct it perceives to be anticompetitive. 

“The FTC’s keen interest in these markets will continue to mean potentially longer regulatory review timelines for high-profile and high-value transactions in the industry,” Maier stressed. 

Ongoing FTC Challenges: Pfizer/Seagen

The FTC and European antitrust authorities are currently scrutinizing Pfizer's $43B acquisition of Seagen, so far the most significant biopharma deal of 2023. In July, the U.S. antitrust watchdog requested additional information as part of it investigation of the merger. 

“We recognize the need to examine with particular scrutiny proposed mergers that may result in lessening of competition and higher prices for consumers. We remain diligent in protecting the American public from these potential harms,” said the FTC’s Alicia Dubuc, Competition Policy International reported. 

The buyout stands as the industry’s largest M&A deal since AbbVie’s acquisition of Allergan for $63 billion in June 2019. Should the deal materialize, Pfizer will have access to four approved products and a robust pipeline of antibody-drug conjugate candidates. The New York–based company projected that the products acquired from Seagen would contribute an additional $10 billion in annual revenues by 2030. The acquisition is expected to be completed between the end of 2023 and the beginning of 2024. Notably, Seagen’s major shareholders have already given their approval for the buyout, leaving its fate in the hands of the FTC. 

In merger challenges, conduct remedies are rare and not preferred, Lewis said. Instead, the preference is a divestiture to resolve the competitive concern. In light of this trend, he said that pharmaceutical companies should reconsider their bundling programs and obtain advice on ‌antitrust implications. 

Katherine Olowookere is an independent tech writer based in Lagos, Nigeria. She can be reached at or via LinkedIn

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