FTC Blocks $627M Surmodics Acquisition Over Competition Concerns

The Federal Trade Commission (FTC) has challenged private equity firm GTCR’s proposed $627 million acquisition of Surmodics, citing antitrust concerns. GTCR, which already owns a majority stake in Biocoat, another major hydrophilic coating provider, would gain control of over 50% of the market if the merger proceeds. The FTC argues that this consolidation would eliminate key competition, potentially reducing innovation, increasing prices, and limiting choices for medical device manufacturers.

To prevent the acquisition, the FTC has filed for a temporary restraining order and a preliminary injunction, aiming to halt the deal pending an administrative hearing. The regulator contends that the hydrophilic coating market is highly specialized, making it difficult for new competitors to emerge. This legal action aligns with the FTC’s ongoing enforcement of stricter merger guidelines under the Biden administration, signaling continued scrutiny of private equity acquisitions in the healthcare sector.