Horizon Therapeutics (HZNP:US) shares fell meaningfully on Tuesday after Bloomberg News reported that biopharma’s proposed acquisition by Amgen (AMGN:US) has attracted increased regulatory scrutiny

The media giant reported that the U.S. (Federal Trade Commission) is expected to sue Amgen and Horizon and try to block the merger, citing competition concerns. If it happens, it would mark the first M&A lawsuit by the FTC in the pharma sector.

Two companies announced last December they agreed to a merger. Amgen will pay $116.50 in cash to acquire Horizon, which represented a premium of approximately 48% to the closing price on November 29, 2022.

Analysts were mostly surprised by the report given the minimal portfolio overlap between Amgen and Horizon.

“If this signals FTC’s view around the broader anticompetitive nature of pharmaceutical mergers, then we could see a potential challenge [to larger transactions],” BMO pharma analyst Evan Seigerman told clients in a note.

Shares of Seagen (SGEN:US) fell 5.97% on Tuesday amid heightened investor concerns that the FTC is also looking at other large M&A deals in the sector. In March this year, it was announced that Pfizer (PFE:US) will pay $43 billion to acquire Seagen.

The news comes after Congress member Daniel Goldman capitalized on the rally in HZNP shares earlier this year. The Congressman from New York was also seen buying Seagen shares in March this year.

Similarly, Representatives Ro Khanna and Josh Gottheimer were buying shares of Seagen recently.