The Federal Trade Commission (“FTC”) recently released its annual report for 2019. The FTC’s annual report details the FTC’s actions over the prior year. In 2019, similar to other years, the health care industry represented 46 percent of the FTC’s competition enforcement actions. That 46 percent was split between general health care (18 percent) and pharmaceuticals and medical devices (28 percent).
Report
As described in the FTC’s report, “The Commission has long prioritized competition in health care markets because such competition helps contain costs, improves quality, increases access, and encourages innovation. Relying primarily on enforcement, the Commission works to prevent anticompetitive mergers and conduct that would harm competition in these markets.”
The FTC describes its program to stop pharmaceutical companies’ anticompetitive behavior, citing an example where one company attempted to stave off generic competition. In this instance, Reckitt Benckiser Group plc agreed to pay $50 million to settle charges that it violated the antitrust laws through a deceptive scheme to thwart lower-priced generic competition to its branded drug Suboxone, a prescription oral medication used to treat opioid addition. Reckitt introduced Suboxone tablets in 2002. Before generic versions of Suboxone tablets became available, Reckitt developed a dissolvable oral film version of the product and worked to shift prescriptions to this patent-protected film, a tactic known as “product hopping.” To further this scheme, Reckitt falsely claimed the reformulated film version was safer than the tablets because the film packaging reduced the risk of accidental pediatric exposure.
In a more recent example, the FTC charged Vyera Pharmaceuticals, LLC with engaging in an anticompetitive scheme to preserve a monopoly for the life-saving drug, Daraprim. The complaint, which the FTC filed with the NY AG, alleges that Vyera purchased Daraprim in 2015, raised its price by more than 4,000 percent, and kept the price high through anticompetitive acts that deterred and prevented potential generic competitors from entering or attempting to enter the market.
In another matter, the FTC successfully challenged a conspiracy involving dental products distributors. In this matter, an administrative law judge held that two of three dental product distributors named in the FTC’s complaint violated the antitrust laws by conspiring to refuse to provide discounts to, or otherwise serve, buying groups representing dental practitioners.