The U.S. Federal Trade Commission (FTC) has ordered Illumina to unwind its $7.1-billion acquisition of cancer test developer Grail while activist investor Carl Icahn has lashed out at the biotech’s board for nearly doubling the CEO’s pay last year.
The FTC said on Monday that allowing Illumina to integrate Grail would stifle competition and innovation in the U.S. market for life-saving cancer tests. Illumina has held Grail as a separate division since completing the deal in 2021 amid resistance from regulators. The EU last year blocked the merger and ordered Illumina to undo it.
Icahn, who is running a contest at Illumina for three board seats, is pushing the biotech to sell Grail, saying the acquisition has done enough harm to the company’s value. Icahn holds Illumina’s top echelon and particularly CEO Francis deSouza responsible for a $50-billion loss in shareholder value since the Grail acquisition closed in August 2021.
In a new letter Monday, Icahn took issue with a decision by Illumina directors to pay CEO deSouza roughly $27 million in 2022, up 87% from a year before, disclosed in a recently filed proxy statement.
‘‘Illumina’s board amazingly justified Mr. deSouza’s massive pay increase by saying it was necessary due to the “highly competitive talent environment.” For once we are in complete agreement with this board. It is probably impossible to find a CEO candidate ’talented’ enough to lose $50 billion of shareholder value in this short a period,’’ wrote the activist, who owns 1.4% of the company’s shares.
Illumina shares were down 1.3% at $230 each at 11:50 a.m. Monday in New York. They were trading below $195 apiece before Icahn kicked off his campaign last month.