Pfizer Inc.’s proposed $43 billion takeover of Seagen Inc. will face an investigation from the European Union’s merger enforcers as the bloc continues to scrutinize large biotechnology deals.
(Bloomberg) — Pfizer Inc.’s proposed $43 billion takeover of Seagen Inc. will face an investigation from the European Union’s merger enforcers as the bloc continues to scrutinize large biotechnology deals.
Seagen disclosed in a regulatory filing late Friday that both firms will notify the deal to the European Commission, and the EU executive has accepted jurisdiction for investigating the proposed merger. The filings say that EU approval is a condition for the deal to close.
Pfizer and Seagen – both headquartered in the US – have the right under EU merger laws as part of a one-stop shop mechanism to request their deal be examined by the European Commission rather than individual EU nations where the acquisition has an impact.
A commission spokesperson said that generally, after the moment in which a merger is said to have an EU dimension, pre-notification discussions with the combining companies can begin.
In the US, the Federal Trade Commission will subject the proposed merger to an in-depth antitrust review, as is normal for major deals. The companies said when the takeover was announced that they expected close FTC scrutiny.
Read more: Pfizer’s Seagen Takeover Plan Faces Further Antitrust Scrutiny
Pfizer announced in March that it would buy the Bothell, Washington-based cancer-drug maker as a way to move out of pandemic mode, the largest takeover so far this year. Seagen is a leader in developing a type of medicine called antibody-drug conjugates, which use antibodies to deposit a strong concentration of drug directly at a tumor site — an effort to increase efficacy with fewer side effects.
If the takeover goes through, Seagen’s portfolio would double Pfizer’s pipeline of early-stage experimental cancer therapies, Pfizer has said.
Notice of the investigation comes as the EU continues to heavily scrutinize large biotech deals.
This week, the bloc hit DNA-sequencing giant Illumina Inc. with a €432 million ($476 million) fine for pushing through its $7 billion acquisition of cancer-test provider Grail Inc. without first obtaining regulatory approval. A divestiture order in that takeover is likely to be issued by EU regulators later this year.
–With assistance from Leah Nylen.
(Updates with EU commission comments in fourth paragraph)
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