The Department of Justice (“DOJ”) Antitrust Division recently announced plans to hold a series of public roundtable discussions to analyze the relationship between competition and regulation, and its implications for antitrust enforcement policy. As the Antitrust Division continues to scrutinize the healthcare industry, these roundtables may give a window into the Division’s current thinking about mergers and acquisitions and contracting practices in the industry. The roundtable series starts on Wednesday, March 14, 2018, with a focus on antitrust exemptions and immunities, including a focus on the appropriate role of the state action doctrine. The roundables will include perspectives from various industry participants as well as “academics, think tanks, and other interested parties to discuss the economic and legal analyses of competition and deregulation.” The second roundtable will be held on April 26, 2018, and will focus on consent decrees. The third roundtable will be held on May 31, 2018, and will analyze the consumer costs of anticompetitive regulations. The DOJ will accept public comments (not to exceed 20 pages) in advance of each of the roundtables. The federal antitrust agencies often hold public events of this nature to further inform their antitrust enforcement agendas. It will be interesting to see if this roundtable series results in any major enforcement policy changes for the Antitrust Division, which is now under the leadership of Assistant Attorney General, Makan Delrahim.
The Third Circuit granted on Tuesday the Federal Trade Commission’s (“FTC”) request for an injunction pending appeal of the proposed merger between Penn State Hershey Medical Center and Pinnacle Health System. The injunction comes just before the temporary restraining order against the merger issued by the U.S District Court for the Middle District of Pennsylvania was set to expire on Friday. Earlier this month, the district court denied the government’s request to block the merger. Continue Reading FTC Wins Stay of Pennsylvania Hospital Merger Pending Appeal in Third Circuit
The Federal Trade Commission (FTC) last week disputed the effectiveness and competitive impact of the Food and Drug Administration’s recently proposed biosimilar naming policy and argued that using different nonproprietary names for biosimilars as compared to their reference biologics would signal clinically meaningful differences to already-confused physicians. The end result would reduce not only biosimilar substitution but also the incentive for aggressive price competition between reference biologics and follow-on biosimilar products. In its written comments to FDA, the FTC argued that a naming convention akin to FDA’s small molecule policy would encourage lower-cost biosimilar price substitution by maintaining consistency for prescribing physicians. Continue Reading FTC Urges FDA to Rethink Its Biosimilar Naming Proposal; Other Stakeholders Agree
The Federal Trade Commission (“FTC”) and Department of Justice Antitrust Division (“DOJ”) (collectively, “agencies”) issued a joint statement to Virginia’s Certificate of Public Need (“COPN”) Work Group, which was recently charged with reviewing Virginia’s certificate of public need process and its impact on health care services in Virginia, including the development of “specific recommendations for changes to the certificate of public need process to address any problems or challenges identified during [its] review.” The agencies’ statement encourages the Work Group and the General Assembly to reconsider whether “Virginia’s COPN laws best serve its citizens” and suggests that the Work Group consider the repeal or retrenchment of the COPN laws in order to promote the efficient functioning of health care markets. This statement is another example of the agencies’ continued vigilance in their efforts to prevent CON laws from suppressing competition by “limiting the availability of new or expanded health care services.”
Virginia’s CON program requires providers such as hospitals, nursing homes, rehabilitation facilities and other general acute care service providers to obtain a COPN from the State Health Commissioner (“Commissioner”) before initiating certain projects. The Commissioner can only issue a COPN after determining that there is a public need for the project. According to Virginia’s Department of Health, the review process can take six to seven months to complete — applications are examined during 190-day review cycles designated for certain batch groups which occurs just twice a year for most groups. Aggrieved parties, including incumbent providers, can appeal the Commissioner’s decision to the circuit court. From the agencies’ perspective, this time-consuming and costly process may deter beneficial entry “since a potential entrant may decide that the process itself is too costly.” Continue Reading FTC-DOJ Join Forces: Encourage Repeal/Retrenchment of Virginia CON Laws
Written by: Stephanie D. Willis
Dionne Lomax and Helen Kim, our colleagues in the Antitrust Practice, have authored an article in Competition Policy International’s September 2014 edition of the Antitrust Chronicle observing that, even in the wake of the Affordable Care Act, which is intended to encourage efficiencies in health care delivery to improve health care quality overall, the antitrust enforcement agency has been limiting the ways that health care providers can assert these goals as a justification for consolidation.
The article profiles recent cases that we have featured on the blog and in the firm’s advisories, including the St. Luke’s case initially profiled here earlier this year by Bruce Sokler, Chair of Mintz Levin’s Antitrust Practice. But more importantly, it provides a framework “that parties can apply when presenting quality improvement claims that may help parties demonstrate that their efficiency claims are credible, merger-specific, and likely to occur.” Read Dionne and Helen’s article here and reach out to them or to our other Antitrust Practice attorneys if you have questions.
This week, the Sixth Circuit unanimously upheld the March 28, 2012 Federal Trade Commission (FTC) administrative decision that ordered ProMedica Health System, Inc. to divest itself of its August 2010 purchase of St. Luke’s Hospital in Lucas County, Ohio.
The Sixth Circuit held that the merger created no substantive or compelling efficiencies and that it would increase ProMedica’s pricing and bargaining power anticompetitively.
Mintz Levin’s Antitrust Practice attorneys Bruce Sokler, Helen Kim, and Timothy Slattery analyze the Sixth Circuit’s decision and discuss how this landmark decision could be a harbinger of greater scrutiny and enforcement against health care provider mergers that the FTC view as anticompetitive. Read the Antitrust Practice Alert at this link.