“Protecting innovation will require us to look at both the incentives of the merging firms, as well as the non-merging firms,” said Caroline Holland, an attorney adviser with the FTC. “For example, the incentives of non-merging firms may be relevant if a merger reduces the number of large firms that are the target sales audience for new innovation developed by a pharmaceutical startup.”

“This may affect the availability of capital to those startups,” she added.