The Federal Trade Commission has filed a lawsuit seeking to block biotechnology company Amgen from buying Horizon Therapeutics for $27.8 billion — the first time the FTC has tried to stop a pharmaceutical merger in years.
The FTC filed a lawsuit in federal court Tuesday to try to stop the deal between Amgen and Horizon, which has its U.S. headquarters in Deerfield. The deal would allow Amgen to strengthen Horizon’s monopoly, when it comes to two of Horizon’s medications: Tepezza, used to treat thyroid eye disease, and Krystexxa, used to treat chronic refractory gout, the FTC alleges.
Those two drugs don’t have any competition now. If Amgen were allowed to buy Horizon, Amgen would be able to use rebates on its existing drugs to pressure insurance companies and pharmacy benefit managers into favoring the two Horizon drugs, the FTC alleges. Pharmacy benefit managers are companies that act as middlemen between insurers, pharmacies and drugmakers.
The FTC alleges that if Amgen buys Horizon, Amgen will likely make it more difficult for other drug companies to bring drugs to market to compete with Tepezz and Krystexxa. Because those drugs don’t currently face competition, Horizon charges about $350,000 for a six-month course of treatment of Tepezza and about $650,000 for an annual supply of Krystexxa, according to the FTC.
“Rampant consolidation in the pharmaceutical industry has given powerful companies a pass to exorbitantly hike prescription drug prices, deny patients access to more affordable generics, and hamstring innovation in life-saving markets,” said FTC Bureau of Competition Director Holly Vedova, in a news release. “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.”
Horizon and Amgen did not immediately respond to requests for comment Tuesday morning.
Horizon, which is based in Ireland, sells orphan drugs, which are medications for rare diseases, and drugs to treat rheumatic diseases. Amgen is a large drugmaker based in California. A new Amgen subsidiary was supposed to acquire Horizon. The deal was originally expected to close in the first half of this year.
Horizon had about 2,000 employees globally, including about 600 at its U.S. headquarters in Deerfield, as of late last year.
It’s not yet clear exactly what will become of Horizon’s Deerfield offices if the deal closes. Amgen and Horizon said in a formal document announcing the plan in December that the combined companies’ global headquarters would be in Thousand Oaks, Calif., and Amgen would evaluate whether to consolidate some or all of the company’s other locations to California and other Amgen locations.
More to come.
