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Roche moving closer to approval of Spark takeover; report

Antitrust authorities in both US and UK look likely to end delay

Roche

The Federal Trade Commission is poised to give its blessing to Roche’s $4.3bn takeover of gene therapy specialist Spark Therapeutics, ending months of delay, according to press reports.

Roche first announced its intention to acquire Spark back in February, but has had to keep pushing the expected date for completing the transaction back as the FTC and UK’s Competition and Markets Authority (CMA) have taken their time to probe antitrust issued raised by the deal.

The concern among shareholders of both companies is that the financial regulators might be concerned about Roche/Spark’s potentially dominant position in haemophilia, so they will be cheered by a report from the Capitol Forum that the FTC is minded to approve the deal without requiring the sale of any assets.

The official line from Roche is still that it expects the deal to close by the end of the year, and that negotiations with the US and UK authorities are still ongoing.

Spark was the first company to win approval for a gene therapy in the US, and if the deal goes through Roche will secure rights to that product – Luxturna (voretigene neparvovec) for a rare inherited retinal disease – as well as four other candidates in clinical trials headed by haemophilia A therapy SPK-8011.

It is thought that the regulators have been scrutinising the deal because Roche’s antibody drug Hemlibra (emicizumab) has been growing at a phenomenal rate since its launch last year, and is firmly on course to become a blockbuster this year with sales of $925m in the first nine months.

Adding Spark’s SPK-8011 and earlier-stage follow-up SPK-8016 would give Roche a strong position in the market, although analysts at Jefferies have previously suggested that with a number of other companies developing gene therapies – including BioMarin, Sangamo and UniQure – that should not be considered overly dominant.

The Capitol Forum report suggests that review staff are happy to accept the deal, but that senior officials at the FTC's Bureau of Competition must also take a look at their findings. A vote by the FTC's chairman and four commissioners would then take place, says the publication.

The CMA has set a deadline of mid-December for a decision on the first phase of its review of the acquisition, which could be the end of the process if it decides there is no need to investigate further. If it decides to carry on the probe, a lengthier second phase would kick off, making an end-2019 completion unlikely.

Article by
Phil Taylor

28th October 2019

From: Sales

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