Pharma industry plays defense on merger guidelines
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Pharmaceutical giants including Amgen, Merck and Gilead formed a coalition Wednesday to push back against a proposed overhaul of federal antitrust guidelines.
Why it matters: In health care, much of the discussion around the tougher merger rules so far has focused on how they might slow down a wave of provider consolidation. But the new coalition, the Partnership for the U.S. Life Science Ecosystem, argues the antitrust proposal would choke off a key source of innovation, since mergers and acquisitions are often the only way for biopharma startups to advance their treatments.
Catch up quick: The Federal Trade Commission and the Justice Department in July proposed changes to merger guidelines that could broadly affect a range of deals, as the Biden administration signaled an era of more aggressive enforcement. The agencies also proposed new premerger requirements.
- Experts have said the guidelines could chill health care dealmaking and make tie-ups costlier and longer to complete.
What they're saying: The federal merger and acquisition rules already in place are "pro-innovation," the new coalition said in a release. Dealmaking in the biopharmaceutical industry is necessary to help life sciences companies stay in operation, they argued.
- The coalition also represents state biopharma trade associations and the Small Business and Entrepreneurship Council.
- The coalition plans to buy ads in the D.C. area over the next several months as part of its campaign, a spokesperson said.
Of note: Amgen, a founding member of the coalition, settled with the FTC last month after the agency sued the drug company over its $27.8 billion purchase of Horizon Therapeutics.
- Hospitals have also urged the administration to withdraw the merger guidelines, arguing they would stop activity that can "enhance quality, reduce cost, and increase access to care."
- But evidence indicates hospital consolidation increases costs.
Editor's note: This story has been clarified to say the new coalition was formed to push back against the proposed overhaul of federal antitrust guidelines, not to formally lobby against them.
