The U.S. Securities and Exchange Commission is investigating the $7.1 billion acquisition of Grail, a cancer screening startup, by San Diego’s DNA-sequencing giant Illumina.
The San Diego-based company disclosed the SEC probe in a quarterly financial filing on Thursday. According to the filing, Illumina was informed of the federal agency’s investigation in July.
Investigators requested “documents and communications primarily related to Illumina’s acquisition of GRAIL,” disclosures concerning the startup as well as the conduct and compensation of certain of Illumina and GRAIL management.
According to the filing, Illumina is cooperating with the SEC in its investigation. The San Diego company declined to comment further when ed by the U-T on Monday.
This marks the latest speed bump in Illumina’s quest to close the loop on its merger with Grail, a startup that developed a diagnostic test to detect up to 50 different kinds of cancer from a single blood draw.
The deal — which was first announced in Sept. 2020 — has been scrutinized by U.S. and European regulators over concerns that it creates an anti-competitive market. Despite these pressures and an ongoing antitrust investigation by the European Union, Illumina completed the purchase of Grail in August 2021.
On July 12, Illumina was slapped with a $476 million fine from the EU over the San Diego company’s decision to buy Grail before getting anti-monopoly regulatory clearance. The company said it intends to appeal the fine, which amounts to about 10 percent of Illumina’s sales — one of the largest fines imposed by the agency for such actions.
