HZNP - FTC likely to lose its challenge to the Horizon/Amgen deal legal experts say - analyst

2023-08-24 12:13:54 ET

The Federal Trade Commission is likely to lose its effort to challenge Amgen's ( NASDAQ: AMGN ) planned $28 billion acquisition of Horizon Therapeutics ( NASDAQ: HZNP ), according to Oppenheimer, which cited legal experts.

The memorandum of law filed by Amgen ( AMGN ) on Tuesday to oppose the FTC's motion for a preliminary injunction to block the Horizon ( HZNP ) deal established the reasons why the Commission is unlikely to succeed on the merits, according to an Oppenheimer analyst who cited outside counsel's opinion.

The companies have done a "good job addressing what they appear to see as `ancient' theories of harm as proposed by the FTC that have previously been tested—and rejected—in court," Oppenheimer analyst Leland Gershell wrote in a note on Thursday.

Amgen ( AMGN ) said in its legal brief on Tuesday that the FTC's lawsuit to challenge the Horizon ( HZNP ) dea l "defies logic. " The legal filing comes as the antitrust regulator is set to square off with Amgen ( AMGN ) in a Chicago courtroom on Sept. 11.

Gershell cautioned that the FTC doesn't need to prevail on all points to establish potential harm.

"Although the companies present well-grounded arguments against the bundling allegations and highlight the speculative nature of the FTC's concerns, their position will need to be bolstered by testimony in court, should the matter take that course," Gershell added.

Oppenheimer still expects the Horizon ( HZNP ) deal to close by mid-December, and merger-arb investors see a deal break price of ~$60 a share, implying that Wall Street sees an 80% probability that the deal closes.

Amgen ( AMGN ) said in June it would not close the deal before Oct. 31 or the second business day after the court rules on the FTC's request to block the deal. U.S. District Judge John Kness set a hearing for Sept. 11 on the FTC's efforts to block the combination.

More on Amgen

• Horizon Therapeutics: Can Investors Profit From Amgen Deal Confusion?
• Improved Outlook For Horizon Therapeutics And Amgen
• Amgen Is Back!
• Amgen Gives You Growth, Dividend Growth, And Value
• Horizon Therapeutics gains amid speculation on potential FTC settlement on Amgen
• Seeking Alpha’s Quant Rating on Amgen
• Earnings data for Amgen
• Dividend scorecard for Amgen

For further details see: