The Federal Trade Commission (FTC) recently filed a lawsuit to block an $8 billion vertical merger between medical technology companies Illumina and Grail; For regulatory watchers, this action provides a window into the FTC’s intentions for future oversight of vertical mergers and how the agency views competition in this market. In a new insight, competition economics analyst Fred Ashton examines the flaws in the FTC’s complaint and the potential benefits of the merger in the quest to end cancer.
- Grail, which is developing a multi-cancer early detection (MCED) test, and Illumina, a manufacturer and marketer of sequencing instruments and consumables for next-generation sequencing systems, are seeking to merge to accelerate development, approval and adoption of the Grail test. CMDE test.
- Although there is disagreement between the courts on the legality of the merger, further analysis suggests that the pro-competitive effects of the merger and the steps Illumina has taken to ensure other MCED test developers continue to have access to its technology outweigh the potential harm to competition.
- Like the Biden administration spear his moonshot to end cancer, he should be careful about the potential harm of an overly aggressive antitrust enforcement regime, because it would delay the pro-competitive effects of mergers in general, and in the case of Illumina and Grail, a breakthrough breakthrough in cancer diagnosis.
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