Pharmaceutical Task Force to Unveil Findings on Merger Rules

Tune in to virtual sessions June 14–15 to learn how industry merger enforcement may change.

The FTC and DOJ will host public virtual sessions Tuesday and Wednesday, June 14–15, that will reveal what the review group, the Multilateral Pharmaceutical Merger Task Force, has discovered about the current nature of competition in the pharmaceutical industry and its assessment of how existing enforcement approaches reflect present conditions.

The task force was set up in March 2021 to identify actionable steps to review and update the analysis of pharmaceutical mergers. In 2021, global deal-making reached an all-time high of $5.8 trillion, so the review was well-timed. In addition, the guidelines have not been updated for 12 years.

The analysis provided new data to update the FTC investigation process, including fully analyzing and addressing the varied competitive concerns that arise with pharma mergers and acquisitions. Exploring a nuanced layer in M&A, the review explored labor market issues, such as how mergers impact the healthcare labor markets, an element experts say is an important byproduct of continual mergers.  

The virtual workshop, called The Future of Pharmaceuticals: Examining the Analysis of Pharmaceutical Mergers, will feature a keynote presentation and panel discussions organized by the task force. The workshop is open to the public, and it will be webcast on the FTC's website, transcribed, and posted online. Registration is not required, and the link to each webcast will be made public on the day of the event.

On the first day of the meeting, FTC Commissioner Rebecca Kelly Slaughter will deliver a keynote address, followed by plenary sessions on market concentration in the pharmaceutical sector and merger remedies. The second day features sessions on the innovation aspects of pharmaceutical mergers and how conduct by pharmaceutical companies affects merger analysis.

Public participation and awareness of the event is crucial to the future of pharmaceutical mergers, says Slaughter in a prepared statement. "Public input is critical to the process of refreshing our approach to pharmaceutical mergers," she says. "In the face of skyrocketing drug prices and ongoing concerns about anticompetitive conduct by pharmaceutical companies, we need to ensure that our investigations fully capture the potential impact on prices, quality, access, drug supply chain resilience, capital market investment, and innovation for new drugs."

Over the years, Slaughter has spoken against several pharma megamergers, such as Bristol- Myers Squibb and Celgene in 2019; AbbVie and Allergan; and Pfizer's Upjohn and Mylan in 2020.

Pharma merger and acquisition activity for 2022, according to data and analytics company GlobalData, has totaled 256 deals involving top global pharmaceutical companies in just the first quarter. These include a variety of mashups, including high-profile contract service agreements, licensing agreements, partnerships, mergers, venture financing, equity offerings, asset transactions, debt offerings, acquisitions, and private equity deals. The U.S. pharma market was the most active, with 114 deals, followed by China, with 28 deals.

"Given the high volume of pharmaceutical mergers, it is imperative that we rethink our approach toward pharmaceutical merger review," Slaughter says. "Working hand in hand with international and domestic enforcement partners on this new joint project, we intend to take an aggressive approach to tackling anticompetitive pharmaceutical mergers."