The U.S. Federal Trade Commission warned hundreds of companies including Pfizer Inc., Baxter International Inc. and Thermo Fisher Scientific Inc. that it could challenge their acquisitions even after the deadline for the agency’s antitrust review had passed.

The FTC sent at least 204 “close-at-risk” letters cautioning companies that an investigation remained ongoing even though the 30 days allotted for the agency’s initial review had expired. The letters, which haven’t been previously disclosed, were sent between June 2021 and July 2022 and obtained by Bloomberg through a Freedom of Information Act lawsuit.

The antitrust agency adopted a new practice of sending the warning letters after President Joe Biden’s pick to lead the FTC, Lina Khan, took over nearly three years ago. The letters were conceived as a way to crack down on mergers at a time when the agency was flooded with deal filings and didn’t have the resources to investigate them all simultaneously.

The practice sparked outrage from the FTC’s GOP commissioners, lawmakers and business groups who claimed they were intended to chill legitimate merger activity. The FTC hasn’t sought to break up any of the mergers by companies that received warning letters.

Under U.S. merger law, deals valued at more than $119.5 million must notify the federal government and wait 30 days to close. The waiting period is intended to give the FTC and Justice Department – which share jurisdiction over antitrust enforcement – time to decide whether a full investigation is needed.

The 204 letters account for about 2.6% of the more than 7,700 merger approval filings the FTC received during the same time period. That’s significantly more than 0.8% of merger filings that led the agency to open in-depth antitrust probes in fiscal 2022.

“The commission’s review is ongoing and an associated investigation open,” the FTC told Pfizer about its $6.7 billion acquisition of Arena Pharmaceuticals Inc. in March 2022. “Please be advised that if the parties consummate this transaction before the commission has completed its investigation, they would do so at their own risk.”

Pfizer announced two days after the FTC’s letter that it had closed the deal to buy Arena. The company said in a statement to Bloomberg that it “respects the role” of the FTC and worked closely with it in the review of the Arena deal.

“They allowed the 30 day waiting period to expire following their review, after which we closed the transaction,” the company said in a statement.

The FTC sent identical letters to Baxter over its $10.5 billion acquisition of medical device maker Hill-Rom Holdings Inc., to Thermo Fisher related to its $17.4 billion deal for clinical research services company PPD Inc. and to Clarivate Plc for its deal to purchase the data provider ProQuest. All of those deals closed soon after receiving the FTC warning letters.

A Clarivate spokesperson confirmed the company received the FTC’s letter, but said they haven’t heard from the agency since. Baxter and Thermo Fisher didn’t respond to requests for comment.

“These letters, like amicus briefs and policy statements, are another tool the commission uses to provide clarity to the greater business community and a reminder that the commission will always be vigilant for anticompetitive conduct even after a deal is done,” FTC spokesperson Douglas Farrar said.

To conserve resources, the agencies only conduct in-depth probes on the most problematic mergers: in the 12 month period that ended on Sept. 30, 2022, the last year for which public data is available, the FTC or DOJ opened 47 in-depth investigations though it received filings on more than 3,000 deals.

The FTC said in August 2021 that a “tidal wave of merger filings” had strained agency resources, and it was no longer able to fully investigate deals within the 30-day timeline. Because of that, the agency would now send “pre-consummation warning” letters to companies when the agency reached the deadline but needed more time, said Holly Vedova, then head of the FTC’s antitrust arm, in a blog post on the agency’s website.

In a 2022 speech, then-commissioner Noah Phillips decried the new letters, alleging they were intended to sow confusion among merging parties and shield the agency’s Democratic leaders from political accountability for unpopular decisions on deals.

At the time, Phillips – one of the FTC’s two Republican commissioners – said the agency had issued at least 60 letters, including some “where we haven’t even begun to conduct an investigation.”

“Either we are wasting staff’s time and taxpayer dollars on needless investigation, or we are misrepresenting to parties what is really happening,” Phillips said.

GOP lawmakers have also questioned the agency’s use of the letters. In a February 2024 report, Republican staff on the House Judiciary Committee said that FTC managers testified that the letters are sent by the agency’s leaders and probes don’t continue after the letters are sent.

The letters are available to all staff on the FTC’s internal network, according to a person familiar with the agency’s process who asked to speak anonymously to discuss internal workings. The agency sends fewer warning letters today than it did when the program began in 2021, the person said.

The FTC denied a public records request seeking disclosure of the letters, arguing they were exempt from release. Bloomberg then sued in federal court. A federal judge ruled in January that the agency must disclose the letters, though it could redact the identity of recipients if the information wasn’t already public.

Of the 204 letters produced by the FTC, the agency only disclosed the identities of eight recipients involved in the four deals. For most deals, the agency receive two filings – one from the buyer and one from the seller - though in more complex transactions, such as those involving multiple acquirers, there may be more than two.