FTC files suit to block Amgen's $28B purchase of Horizon Therapeutics
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The Federal Trade Commission filed a lawsuit to block Amgen's (NASDAQ:AMGN) $27.8B planned acquisition of Horizon Therapeutics (NASDAQ:HZNP). Horizon fell 14%. 
The complaint was filed in Illinois federal court under seal. The lawsuit seeks an injunction to stop the deal from closing while the FTC goes forward with an in-house trial.
"The Federal Trade Commission is seeking to block biopharmaceutical giant Amgen Inc. from acquiring Horizon Therapeutics plc, saying the deal would allow Amgen to leverage its portfolio of blockbuster drugs to entrench the monopoly positions of Horizon medications used to treat two serious conditions, thyroid eye disease and chronic refractory gout," the FTC said in the statement.
Those drugs are, respectively Tepezza (teprotumumab) and Krystexxa (pegloticase). In Q1 2023, Tepezza brought in revenue of ~$405.3M, while Krystexxa revenue was ~$187M.
Amgen (AMGN) agreed to acquire Horizon Therapeutics (HZNP) for $116.50 a share in cash in December, valuing the Ireland-based biotech at nearly $27.8 billion.
"Today's action --- the FTC's first challenge to a pharmaceutical merger in recent memory --- sends a clear signal to the market: The FTC won't hesitate to challenge mergers that enable pharmaceutical conglomerates to entrench their monopolies at the expense of consumers and fair competition," FTC Bureau of Competition Director Holly Vedova said in a statement.
Late Tuesday morning, Amgen (AMGN) issued a response to the FTC lawsuit: "We have been working cooperatively over the past several months to address the questions raised by the FTC's investigative staff and believe we have overwhelmingly demonstrated that this combination poses no legitimate competitive issues. 
Horizon (HZNP) also responded: "The FTCâs complaint impacts patients and is rooted in a theory about potential future 'bundled' contracts with payors and not competitive overlap concerns. Horizon does not and has no plans to bundle any of its rare disease medicines. "
Amgen (AMGN) said it intends to work with the court on a schedule that would allow the deal to close by mid-December. 
The medicines offered by Amgen and Horizon generally treat different diseases and patient populations, and there are no overlaps of competitive concern."
The FTC argues that Amgen has "strong incentives" post-acquisition to raise Tepezza and Krystexxa "rivals' barriers to entry or dissuade them from competing as aggressively" if and when they receive FDA approval. 
In addition, the agency said its lawsuit "dovetails" its response to complaints it says it has received regarding rebates and fees paid by drug manufacturers to pharmacy benefit managers "to favor high-cost drugs at the expense of lower cost drugs."
The FTC challenge also comes as Sen. Elizabeth Warren (D-MA) wrote the FTC in a letter in late January that she had concerns about the Horizon/Amgen deal.
The case is Federal Trade Commission v. Amgen, 1:23-cv-03053, US District Court, Northern District of Illinois.
More on Horizon/Amgen
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Horizon Therapeutics: Attractive 7.16% Upside To Amgen Deal
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