Illumina fined record €432mn for ignoring EU concerns over Grail deal

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The European Union has slapped a record fine on Illumina after the world’s biggest gene sequencing company completed its $8 billion takeover without Brussels’ approval, which regulators said was a “cornerstone” of their authority.

The European Commission on Wednesday imposed a fine of €432 million, equivalent to 10 percent of Illumina’s revenue and the largest fine it can impose for such infringement.

New York-listed Illumina and Brussels are locked in a legal battle through 2021 after the US company went ahead with its purchase of cancer test developer Grail while EU regulators examine whether the deal would harm competition.

EU regulators decided to block the transaction a year later, saying it would stifle innovation and limit options for consumers. Illumina disputed the EU’s authority to investigate the deal, pointing to the fact that Grail has no revenue in Europe.

In announcing the fine, the European Commission said that “merging companies do not have to implement the merger unless it has been approved by the Commission in accordance with EU merger rules”.

It added: “It is a cornerstone of the European merger control system that enables the Commission to play its role before structural changes modify the competitive landscape.”

The decision to impose the maximum fine signals a desire by authorities to deter other companies from following Illumina’s example. Illumina’s punishment is less than the previous largest fine for a similar breach, when telecoms group Altice was hit with €125mn, equivalent to 1 per cent of its revenue.

Illumina said it would appeal against the fine. “We believe that is fine. , , is illegal, unfair and inconsistent,” the company said.

The decision to complete the acquisition of the San Diego-based company generated a challenge from Carl Icahn. The US activist investor called the deal reckless and pressed for the removal of Illumina’s longtime chief executive, Francis D’Souza, who agreed to step down in June.

Graal has said that it aims to create a cancer screening test for people without symptoms. Illumina has accused Brussels of putting lives at risk by blocking a deal that aimed to bring to market a blood test to screen for dozens of different cancers.