EU Alleges Illumina Illegally Closed Buyout of Grail and Might Face Hefty Fine- Update

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By Daniel Michaels

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European Union antitrust regulators accused US life-sciences company Illumina Inc. of breaching merger regulations by implementing its acquisition of Grail Inc. while an EU probe into the deal was still underway.

The European Commission, the EU’s antitrust regulator, said it has issued a statement of objections over the alleged infraction.

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Illumina didn’t immediately respond to a request for comment on the EU allegation. Grail didn’t immediately respond to a request for comment.

Illumina announced its $7.1 billion acquisition of medical-testing company Grail in 2020. The Commission last July opened an in-depth investigation into the proposed deal. The next month, Illumina said it had completed the acquisition. Days later the Commission opened a second investigation into whether Illumina had breached a requirement to halt the transaction during the EU review, known as a standstill obligation.

If the Commission finds that Illumina and Grail broke EU law by seeking to complete their deal, it could level a fine of up to 10% of each company’s annual global revenue.

“If companies jump the gun and implement deals that are subject to our review, they will undermine the effective functioning of our EU merger control system,” said EU Executive Vice President Margrethe Vestager, the bloc’s top antitrust regulator. “This is a serious breach of the standstill obligation.”

Illumina responded by challenging the Commission’s authority to assess its deal, which was based on a new interpretation of longstanding EU competition law. The EU’s second-highest court recently sided with the Commission, saying it indeed had legal authority to launch its probe.

A campaign for Illumina said after that ruling that the company would appeal the decision. He said Illumina was committed to showing the deal is pro-competitive and that it would facilitate equal and affordable access to cancer detection tests developed by Grail. “We remain focused on obtaining clearance of the deal,” the said.

The merger initially drew scrutiny from the EU and the US competition authorities, with regulators on both sides of the Atlantic saying they are concerned the deal could harm competition and innovation in the market for cancer detection tests. Illumina has said the deal would enhance competition and expand patient access to Grail’s cancer tests.

Write to Daniel Michaels at [email protected]


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