FTC Gets Court Backing to Halt IQVIA’s Purchase of Propel Media

The Federal Trade Commission won its motion to temporarily block IQVIA Holdings Inc.'s planned purchase of California health advertising firm Propel Media Inc.

A preliminary injunction halting the proposed transaction “is in the public interest,” Judge Edgardo Ramos of the US District Court for the Southern District of New York said in a ruling Friday. The size of the proposed deal hasn’t been disclosed.

“The FTC has shown that there is a reasonable probability that the proposed acquisition will substantially impair competition in the relevant market and that the equities weigh in favor of injunctive relief,” Ramos said.

The FTC sued in July to block IQVIA’s acquisition of Propel, alleging the deal would lead to further consolidation in the market for health care programmatic ads and drive up prices. The case is part of a trend of more aggressive antitrust enforcement, especially focused on deals in the healthcare sector.

IQVIA said in a statement that it’s disappointed by the court’s decision to grant the FTC’s request for a preliminary injunction.

“We are reviewing the decision and evaluating our options,” IQVIA stated. “IQVIA’s acquisition of Propel Media would make it easier for patients and doctors to obtain the healthcare information they need to make better decisions that lead to better health outcomes. We maintain that the FTC’s arguments in this case are inconsistent with the reality of the marketplace and unsupported by the law.”

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IQVIA is a Fortune 500 healthcare data provider that generated more than $14 billion in revenue last year. Propel owns DeepIntent, an advertising platform that targets healthcare professionals and other healthcare consumers.

The FTC claims the deal would eliminate head-to-head competition between the Lasso digital advertising platform that IQVIA bought last year and DeepIntent. Health care advertising is a multibillion-dollar industry that has seen growth in recent years as the Covid-19 pandemic led healthcare companies to increasingly shift toward online marketing.

FTC also argues the deal would reduce innovation in the market, harming patients and leading to higher health care prices due to higher marketing costs. The FTC says the proposed deal means Lasso would face significantly less competition from DeepIntent than it does currently.

Anticompetitive Claims

In court filings, IQVIA argued the FTC hasn’t proven the proposed merger is anticompetitive. It said the deal would add DeepIntent’s direct-to-consumer and connected TV advertising capabilities that Lasso doesn’t have.

There is some overlap between the two platforms, but IQVIA argues that the two platforms are also complementary in nature: IQVIA’s Lasso focuses on targeting health care professionals by advertising medicines, new treatments for diseases, and hospitals looking to recruit doctors. DeepIntent’s platform specializes in targeting consumers interested in health care products including over-the-counter medications such as Tylenol or weight loss drugs like Ozempic.

IQVIA also argues that its share of the market is limited as many other players, including social media companies and Alphabet Inc.‘s Google, can reach doctors and other healthcare professionals with advertising.

The Chamber of Commerce, in an amicus brief,urged the court to deny the FTC’s motion for a preliminary injunction. The chamber argued that the agency doesn’t provide sufficient evidence of anticompetitive harms from the deal and that its brief was riddled with speculation about what IQVIA may or could do after the merger.

“Requiring real-world evidence regarding anticompetitive harm—which will not exist in most circumstances— is consistent not only with economic and legal realities, but also with desirable policy outcomes,” the chamber stated.

IQVIA is represented by Weil, Gotshal & Manges LLP and Cleary Gottlieb Steen & Hamilton LLP.

Propel Media is represented by Morrison & Foerster and Proskauer Rose LLP.

The FTC represents itself.

The case is FTC v. IQVIA Holdings Inc., S.D.N.Y., No. 1:23-cv-06188, 12/29/23.