Lexology August 19, 2021
Cornerstone Research

Several recent high-profile merger review cases in the life sciences space – including Celgene/Bristol-Myers Squibb, Illumina/Pacific Biosciences (PacBio) and Roche/Spark – have focused on innovation theories of harm, concerns that a merger may decrease the level of innovation activities by the merging parties or their competitors and harm consumer welfare. While evaluating such theories of harm is understandably of high interest, antitrust authorities should recognise that innovation is an area that does not lend itself to generalisations of a single economic theory or model. While generalising the production function for widgets as a mathematical function works well enough, innovations are not like widgets and using the same approach can lead to three fundamental problems. First, generalisations are necessarily limited by...

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