Just as biopharma’s M&A prospects seemed to be improving, the U.S. antitrust watchdog is putting a damper on dealmaking. The U.S. Federal Trade Commission has filed a lawsuit to block Amgen’s proposed $27.8 billion acquisition of Horizon Therapeutics, the agency said Tuesday. By a unanimous vote among the three Democrat commissioners, the agency is seeking a temporary restraining order and preliminary injunction to prevent the transaction from closing.
In an alarming sign for biopharma M&A scrutiny to come, the FTC argues Amgen could leverage its existing product portfolio to “entrench the monopoly positions” of Horizon meds for thyroid eye disease and chronic gout.
The antitrust challenge marks the first time that the FTC has reached beyond specific product overlaps in its reviews and instead focused on companies’ past behaviors around drug pricing. It's an approach that the agency has threatened to implement since 2021 but has only now reared its teeth. And the FTC isn’t shy about its intentions.
“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 Tuesday.
An antitrust challenge against the Amgen-Horizon deal is “broadly negative” for biopharma's dealmaking sentiment, SVB Securities analysts wrote in a Monday note before the official FTC statement. William Blair analyst Matt Phipps, Ph.D., in a separate note, said the move will “dampen M&A enthusiasm across the biotech sector.”
Amgen and Horizon do have product overlaps for specific pipeline candidates, but as RBC Capital Markets analysts stressed in their note, the two companies have “no commercial muscle” in those areas.
Horizon’s anti-IL7Ra antibody ADX-914 and Amgen’s OX40 antibody rocatinlimab are each in development for atopic dermatitis, Berenberg analyst Zhiqiang Shu, Ph.D., pointed out in a note.
Elsewhere, Horizon is developing daxdilimab for lupus, while Amgen has two candidates for lupus that recently failed in midstage trials.
Looking outside those overlaps, the FTC argues Amgen’s $24.8 billion in annual sales from a product portfolio of 27 approved drugs—including TNF blocker Enbrel and oral psoriasis drug Otezla—could give the company power to pressure insurers and pharmacy benefit managers into accepting high prices for Horizon’s thyroid eye drug Tepezza and gout therapy Krystexxa.
“Amgen has a history of leveraging its broad portfolio of blockbuster drugs to gain advantages over potential rivals,” the FTC argued.
Given the wide adoption of Amgen’s existing drugs and the potential value of rebates it can offer, it may be “difficult, if not impossible, for smaller rivals” to compete against Tepezza and Krystexxa, the FTC argued.
In response, Amgen said it’s “disappointed by the FTC’s decision and remains committed to completing this acquisition.”
Amgen argued the the FTC’s claim around drug bundling is “entirely speculative and does not reflect the real world competitive dynamics behind providing rare-disease medicines to patients.”
The company has promised to not bundle the Horizon products, but the FTC still moved to block the deal, Amgen said.
Amgen is seeking to buy Horizon as its internal portfolio struggles. The crown jewel of the deal, as RBC noted, is Tepezza, which brings about $2 billion in sales annually and is projected to reach $4 billion in sales at its peak. Gout drug Krystexxa, which is also in testing for myasthenia gravis, plus Uplizna for neuromyelitis optica spectrum disorder, are also potential blockbusters.
For the past two years, the FTC has promised to look beyond standard product overlaps when evaluating proposed biopharma transactions. The agency has specifically raised concerns about concentrated bargaining power for large companies during drug pricing negotiations.
But the SVB analysts argued that in orphan diseases—where Tepezza, Kyrstexxa and Uplizna reside—the practice of drug bundling is uncommon.
The deal has already attracted congressional scrutiny. Sen. Elizabeth Warren earlier this year singled out the transaction in a letter to the FTC, urging the agency to take a closer look at the acquisition. She argued the merger presents “numerous antitrust and price gouging concerns” because both companies have engaged in “brazen price increases."
Following Warren’s open letter, Amgen disclosed a “second request” from the FTC for more information.
Some may view the FTC challenge as a way out for Amgen after Tepezza sales disappointed in the first quarter. Horizon’s stock plunged 17% in premarket trading Tuesday, while Amgen’s shares slightly gained. But William Blair’s Phipps argued that Amgen desperately needs the additional assets to drive revenue growth given how its existing portfolio has struggled.
Therefore, Phipps expects Amgen will fight the FTC in court.
Meanwhile, the FTC’s broad approach could throw cold water on other biopharma deals. After a relatively slow year in 2022, dealmaking appears to be heating up thanks to a string of biopharma acquisitions by Pfizer, Merck & Co, Sanofi and GSK.

Reference:fiercepharma.com/pharma/ftc-prepares-block-amgens-28b-horizon-buy-broadly-negative-move-biopharma-ma-report