AstraZeneca Moves Closer to Acquiring Alexion For $39 Billion


Just as pharma observers were bracing themselves for the brunt of renewed antitrust scrutiny around monumental Biopharma transactions, AstraZeneca’s mega-acquisition of Alexion Pharma sailed through the much-feared review without a hitch.


In an anticlimactic announcement Friday, AZ disclosed that the U.S. Federal Trade Commission has given a go-ahead to the $39 billion deal first unveiled in December.

None of the extra antitrust challenges that analysts had dreaded for the marriage actually occurred. The FTC didn’t attach any additional conditions to the deal. In fact, the approval simply followed the 30-day waiting period triggered when the companies resubmitted their transaction for review on March 16.


Analysts had anticipated the deal to face tough resistance from the new Democrat-led FTC after the agency threatened more aggressive oversight in mid-March, revamping its approach to looking into Biopharma deals in particular.


As the biggest Biopharma M&A deal in 2020, the Alexion purchase was an obvious target the new Agency could have used to sharpen its regulatory knife. AZ’s nearly concurrent announcement in March – that it had decided to withdraw and refile the M&A notification form after “informal discussions” with the FTC – only piled further uncertainty to the deal.

In a recent note that reflected the general view among pharma observers, SVB Leerink analyst Geoffrey Porges predicted a high chance that FTC would either block the transaction or saddle it with “onerous conditions.”


As the new FTC collaborates with foreign counterparts and other U.S. agencies to finalize its newly vigilant approach, one possible scenario was that the AZ-Alexion review period would be extended with the notorious “second request,” in which the agency requests for an additional document pertaining to a transaction. That apparently didn’t take place.


The Biden FTC is now pursuing an approach that investigation of Biopharma transactions shouldn’t focus primarily on specific product overlap but more broadly on whether the companies involved undertake harm innovation. Previous anticompetitive conduct, such as drug-price hikes as well as pay-for-delay settlements, could all be considered.


From a portfolio perspective, AZ and Alexion have no clear overlap. Alexion is regarded as a rare disease expert, whereas AZ isn’t involved in that field. In fact, AZ ranked very low on analysts’ lists of likely Alexion buyers prior to the announcement of the deal.

AZ is also purchasing Alexion for the latter’s expertise in immunology. There, both companies don’t have products that rival each other.