A rule recently proposed by the US Federal Trade Commission (FTC) and the Antitrust Division of the U.S. Department of Justice (DOJ) could put a damper on mergers and acquisitions, including those in the diagnostics industry.
As explained in a recent G2 Intelligence Laboratory Industry Report article, companies would need to provide much more information about any proposed deals in documents submitted to the FTC and DOJ. The agencies estimate that the new requirements will more than triple the amount of time it will take companies to prepare such documents, according to the G2 article. However, FTC representatives said in a statement that this expanded information is necessary to properly determine whether proposed mergers and acquisitions “may violate…antitrust laws.”
Outlined by G2 Intelligence writer Glenn Demby, the proposed rule features six new disclosure requirements related to:
- Transaction Information
- Narrative Information about Competition
- Labor and Employee Information
- Information about Prior Acquisitions
- Periodic Plans and Reports
- Organizational Structure
In addition to making it more time-intensive to prepare forms for proposed mergers and acquisitions, Demby writes that the new rule “will likely make securing regulatory clearance for proposed deals difficult” and may make “labs and other providers more reluctant to pursue such deals.”
He adds that the new rule may, in fact, be meant to put a stop to what the Biden administration sees as harmful consolidation in the healthcare space.
To read the full article, “Sweeping New FTC Rules Could Chill Healthcare Mergers and Acquisitions,” log in to your Laboratory Industry Report subscription.