FTC Asks Judge to Cancel Illumina’s $7.1 Billion Acquisition of Spinoff Grail

A building on the Illumina Campus in University City. Reuters/Mike Blake

The U.S. Federal Trade Commission on Tuesday said it seeks to unwind life science company Illumina‘s $7.1 billion acquisition of Grail, alleging it would harm innovation and boost prices.

FTC senior counsel Susan Musser said in her opening statement at a trial in Washington that cancer test-detection company Grail and its competitors rely on San Diego-based Illumina’s DNA sequencing technology. She argued that Illumina’s purchase of Grail would give the company the “incentive and ability to foreclose downstream rivals.”

Antitrust lawyers are closely tracking the FTC trial as a rare enforcement action against a “vertical” merger in which two companies are not direct competitors. The FTC’s witnesses are expected to include representatives from other companies competing with Grail.

“Evidence will show that the war on cancer, if it is to be won, will be won by competition, not by this acquisition,” Musser said. Grail is in an “innovation race” to develop and market its early-detection test, she added, and Illumina would have the power to “anoint” Grail the winner if the deal is not canceled.

Illumina, founded in 1998, owned Grail but spun it off in 2016 while retaining a 12% ownership stake.

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