UK regulator probes $39bn AstraZeneca tie-up with Alexion

UK regulator probes $39bn AstraZeneca tie-up with Alexion

The UK competitors regulator is probing AstraZeneca’s $39bn takeover of US biotech group Alexion after elevating potential antitrust issues.

The Competitors and Markets Authority mentioned on Tuesday it was investigating the deal signed in December when AstraZeneca — a key Covid-19 vaccine producer — agreed to purchase US firm Alexion, a biotech specialising in therapies for uncommon ailments. 

The UK regulator mentioned the deal had met its take a look at for a related merger — that means there was a threat that the 2 corporations would stop to be distinct, and had met the edge for the CMA to research. 

The CMA has set a deadline of June three to obtain views from events and has till July 21 to determine whether or not to launch a extra in-depth investigation.

AstraZeneca mentioned it nonetheless anticipated the deal to shut within the third quarter. “The graduation of the UK CMA’s formal overview is one other necessary step in direction of closing of the proposed acquisition,” the corporate mentioned. 

The deal has already been authorized in ten nations, together with by the US Federal Commerce Fee and is being examined by regulators within the EU and Japan. Greater than 99 per cent of AstraZeneca and Alexion shareholders just lately voted in favour of the deal. 

The $39bn acquisition is designed so as to add 5 authorized medicines and a pipeline of 11 potential medication, including double-digit income development till 2025 on the London-listed pharmaceutical firm.

There is no such thing as a vital geographic or product overlap between the 2 corporations. AstraZeneca is hoping that Alexion’s analysis and growth within the space of complement biology, which it has up to now centered on uncommon ailments brought on by uncontrolled activation of the immune system, might be used for extra widespread situations, together with cancers.

However the UK regulator has a broad discretion to justify analysing mergers that would have an effect on UK markets, and has taken an more and more versatile method to the exams it makes use of to intervene. In February 2020 the CMA checked out US biotech firm Roche’s deliberate $5bn acquisition of fellow US firm Spark regardless of the very fact the latter had no UK turnover. The CMA mentioned Spark’s analysis and growth actions in Britain justified a part 1 evaluation, however didn’t take the investigation additional.

Alexion relies in Boston, Massachusetts, and books its largest gross sales within the US. It runs its worldwide operations from Switzerland and sells its medication in additional than 50 nations, together with the UK.

When AstraZeneca introduced the deal final yr, chief government Pascal Soriot mentioned it will strengthen the UK-based drugmaker’s place within the US, the place it has been rising, particularly in oncology. He mentioned AstraZeneca might assist Alexion broaden in rising markets, together with China. 

Shares in AstraZeneca fell zero.four per cent to £81.20p in morning buying and selling in London. 

The CMA’s choice to probe AstraZeneca and Alexion comes because it weighs new approaches to coping with pharma mergers. In March it joined regulators together with the US Federal Commerce Fee and the European Fee in a working group to think about increasing the “theories of hurt” it makes use of when addressing huge pharma offers.

CMA chief government Andrea Coscelli mentioned on the time that he wished to “defend shoppers from anti-competitive offers” within the sector, however famous “huge pharma performs a necessary position in our society”.

Recommended For You

Main Menu