Edwards-JenaValve: FTC defines relevant market based on overlapping clinical trials, expanding its theory of innovation competition in merger analysis

In recent weeks, the Federal Trade Commission (FTC or the Commission) filed an administrative complaint seeking to enjoin Edwards Lifesciences Corporation’s (Edwards) proposed acquisition of JenaValve Technology, Inc. (JenaValve).¹ This action marks an inflection point in the Commission’s merger enforcement aimed at addressing competitive overlaps in markets involving innovation competition – rivalry in the research, development, and introduction of new or improved products, technologies, or processes. In its administrative complaint,² the FTC frames the alleged competitive harm not on existing product overlaps, but on the alleged loss of competition between two late-stage clinical development programs involving similar medical devices.

By defining the relevant market to include these near-market pipeline products, and by emphasizing competitive dynamics such as trial site competition, finite patient pools, and overlapping launch timelines, the FTC is signaling its willingness to block healthcare deals based solely on potential competition theories. Edwards has signaled its intent to litigate the matter, which will test the agency’s “pipeline-to-pipeline” competitive overlap theory. We summarize below the FTC’s recent guidance on competitive overlaps involving innovation competition and the claims presented in the Edwards-JenaValve litigation, before addressing the potential implications of this development on future pharmaceutical and medical device mergers.

The FTC’s approach to pipeline products

In most cases, U.S. merger analysis defines the relevant market in which competition may be affected with reference to the merging parties’ existing products or services. Existing products, or those that will enter the market in the very near term, are typically amenable to demand-side/substitutability analysis and supply-side checks – the traditional tools the antitrust agencies have used to evaluate competitive overlap for purposes of market definition.

However, market definition may reach more broadly to encompass “harm to innovation,” including with respect to products still in development. The agencies have expressed concern that eliminating firms’ independent efforts to research and develop similar products may reduce innovation, slow the development process, or reduce future competition. Under the 2023 Merger Guidelines (the Guidelines), the agencies provide explicit guidance that when an alleged harm is to innovation, a relevant market may be defined “around the products that would result from that innovation if successful, even if those products do not yet exist.”³ The elimination of “substantial competition” between firms under the Guidelines may “include competition to research and develop products or services, and the elimination of such competition may result in harm even if such products or services are not yet commercially available.”⁴ The Guidelines build upon the findings of a Multilateral Pharmaceutical Merger Task Force formed in March 2021 by then-Acting Chairwoman Rebecca Kelly Slaughter and a June 2022 workshop jointly held by the DOJ and FTC, which reflected a growing consensus that certain products still in clinical development should be treated as current market participants for antitrust analysis.⁵

Under the more flexible market definition standard in the Guidelines, the following are key factual indicators that the antitrust agencies may rely upon when determining whether pipeline products belong in a defined relevant market:

• Stage of development and timing to market. The antitrust agencies are more likely to consider later-stage programs (e.g., Phase 3 drug trials) as part of a relevant market, but earlier-stage development may qualify a pipeline product for inclusion in a relevant market if development is sufficiently advanced and regulatory approval appears probable.⁶ A related factor is when the products will enter the market: The agencies have signaled that if merging companies’ clinical pipelines are likely to obtain regulatory approval and enter the market around the same time, the products under development are more likely to be considered in merger analysis.
• Indication overlap and therapeutic substitutability. If trials target the same disease population or utilize overlapping efficacy indications, it is more likely the pipeline products will be considered part of the relevant market. Similarly, the agencies consider whether the products are likely to be viewed as substitutes by prescribers, payers, or regulators. For example, a similar mechanism of action or dosage that delivers similar clinical outcomes in the development phase weighs in favor of considering a potential product as part of the relevant market.
• Trial enrollment and scale and exclusivity of trials. If two firms are the sole companies running trials in a narrow indication, or if they compete for the same limited patient pool, this is a significant factor the agencies weigh in favor of including the pipeline products within a relevant market.
• Documentary evidence of head-to-head competition. Similar trial designs, statements to investors, and feedback received from investigators on market conditions are highly relevant to the analysis.

Edwards-JenaValve: The Commission’s latest innovation 

On August 6, 2025, the FTC filed suit in its administrative court to enjoin a proposed acquisition that it claims would eliminate the only meaningful domestic competition in a narrowly defined market for transcatheter aortic valve replacement devices designed to treat aortic regurgitation (TAVR-AR). Noting that FDA approval is required for U.S. payer reimbursement and commercial adoption of such devices, the agency treats the United States as the relevant geographic market. The complaint’s core factual predicate—and the battlefield for the pending litigation—concerns the relevant product market.

The Commission claims that Edwards (through its affiliate JC Medical) and JenaValve are the only two companies currently conducting clinical trials of TAVR-AR devices. Both companies are engaged in active clinical trials characterized as “pivotal” or “early feasibility programs,” and they anticipate FDA approval in the near to medium term.⁷ Based on this, the agency asserts that the merger would eliminate “ongoing competition” between the companies “to improve the quality of their TAVR-AR devices and generate superior clinical outcomes” – a quintessential harm to “innovation” competition between the only two players with active research and development efforts addressing a narrow indication.⁸ More specifically, the merger is alleged to reduce rivalry between the companies that is currently driving accelerated research and development timelines, promoting enrollment competition for top sites and patients for the clinical trials, fostering improvements in device outcomes in the trials, and supporting competition for future commercialization of the approved devices.⁹ Consolidation, by contrast, would allegedly remove those incentives and likely lead to deprioritization of one of the devices, slower innovation, worse patient outcomes, and higher prices for any approved devices that enter the market.¹⁰

The Commission alleges that no other TAVR-AR competitor is conducting comparable clinical trials in the United States and therefore no new entrants are likely to offset the alleged harm to competition from the proposed merger. In framing the evidence, the FTC asserts that active, advanced-stage clinical trials (i.e., “pivotal” trials) and documentary evidence that the parties view each other as head-to-head rivals support a narrow market definition based on pipeline-to-pipeline competition. In this sense, the agency’s latest enforcement action appears to be its most aggressive application of the revised guidelines on innovation competition to date.

With Edwards vowing to litigate the matter, this will be a case to closely watch going forward. Success on the merits may embolden the Commission to pursue investigations and enforcement actions against similarly situated firms in the pharmaceutical, life sciences, and medical device industries – industries in which competition for clinical development and regulatory approval of nascent products among a concentrated set of companies is standard fare. By contrast, a win for Edwards may place meaningful limits on the extent to which the antitrust agencies are able to narrowly define product markets in matters involving competition for innovation.