December 19, 2023

Illumina announces plan to divest Grail

On December 17, 2023, US-based DNA sequencing developer Illumina, Inc. announced its plan to divest Grail, Inc., a US-based company that develops cancer screening tests.  The announcement was made just days after the US Court of Appeals for the Fifth Circuit ruled that there was substantial evidence to support the US Federal Trade Commission’s determination that the merger threatened competition in the market for cancer detection tests.  While the Fifth Circuit vacated the FTC order requiring Illumina to divest Grail and remanded it for further proceedings, Illumina indicated in its statement that it had elected not to pursue further appeals of the decision.

Illumina also revealed that the divestiture, which should be finalized by the end of the second quarter of 2024, will be executed through a third-party sale or capital markets transactions in accordance with the European Commission’s divestiture order issued in October 2023.  Illumina’s CEO Jacob Thaysen also indicated that he is committed to an expeditious divestiture in a manner that allows Grail’s technology to continue benefitting patients.

Illumina also issued a cautionary note on forward-looking statements while revealing that the following factors may cause actual results to materially differ from previous statements made:  i) Illumina’s ability to agree upon a divestment plan that complies with the European Commission’s divestment order; ii) the company’s ability to execute a strategic alternative in a timely manner that maximizes the value of Grail to Illumina’s stockholders within the parameters of the divestment order; iii) the risk that ongoing legal proceedings that challenge the decisions of the European Commission and FTC will not be favorable to Illumina; and iv) the risk that distractions associated with the divestment and associated legal proceedings or regulatory obligations will harm Illumina’s business.  Illumina also indicated that it did not intend “to update is forward-looking statements, to review or confirm analysts’ expectations or to provide interim reports or updates on the progress of the current quarter.”

Illumina Press Release | FTC Press Release