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Amgen's $27.8 Billion Horizon Takeover Approved by FTC

September 1, 2023
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Amgen Inc. has received the green light to proceed with its $27.8 billion acquisition of Horizon Therapeutics Plc, as the U.S. Federal Trade Commission (FTC) announced its acceptance of a binding settlement. Under this agreement, the merged entity commits not to bundle two of Horizon's major drugs together.

This acquisition, which stands as Amgen's largest to date, was initially announced in December. In May, the FTC filed a lawsuit, marking its first federal court challenge to a pharmaceutical deal since 2009. However, this settlement has averted an injunction hearing that was scheduled to commence on September 13 in a federal court in Chicago.

The news of this development resulted in a 2.9% premarket rise in Horizon Therapeutics shares. Similarly, Seagen Inc., currently under FTC review for its acquisition by Pfizer Inc., experienced a 2.4% premarket increase.

Amgen issued a statement indicating its intention to swiftly pursue the final approvals required under Irish law, with the expectation of closing the deal later this year.

Under the terms of the agreement, Amgen has committed not to bundle its drugs with Horizon's monopoly medications, namely Tepezza (used for treating thyroid eye disease) and Krystexxa (for chronic refractory gout). Amgen also agreed not to acquire any additional treatments for these conditions without prior approval from the FTC. Additionally, a monitor will oversee all insurer-related contracts regarding coverage of these two drugs for the next 15 years.

FTC Chair Lina Khan stated that the agency accepted this settlement due to the involvement of so-called orphan drugs, which are treatments for rare medical conditions regulated differently. She emphasized that these will be straightforward to monitor.

Khan further emphasized the FTC's commitment to challenging unlawful practices that affect drug prices, hinder access, impede innovation, or negatively impact patients.

The FTC had argued in its lawsuit to block the Amgen deal that it would solidify Horizon's monopol on these drugs, which currently face no competition. In 2022, these two medications generated approximately $2.69 billion in revenue for Horizon, as per company filings.

Amgen boasts a portfolio of 27 approved drugs, including renowned treatments like Enbrel for rheumatoid arthritis and Otezla for psoriasis.

Notably, the FTC, along with European antitrust authorities, is also scrutinizing Pfizer's acquisition of Seagen, which stands as one of the year's largest deals. The U.S. agency initiated an in-depth investigation of this deal in July.

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