On Tuesday, the Federal Trade Commission (FTC) and the U.S. Department of Justice (DOJ) Antitrust Division announced that a new Multilateral Pharmaceutical Merger Task Force has been created in coordination with several international agencies. The Task Force, which was initiated by the FTC, but also includes the Canadian Competition Bureau, the European Commission Directorate General for Competition, the United Kingdom’s Competition and Markets Authority, and the U.S. Offices of State Attorneys General, is seeking the public’s help to identify steps to review and update the process of analyzing pharmaceutical mergers.
“Public input is critical to the process of refreshing our approach (to) pharmaceutical mergers,” said Acting FTC Chair Rebecca Kelly Slaughter. “In the face of skyrocketing drug prices and ongoing concerns about anticompetitive conduct by pharmaceutical companies, we need to ensure that our investigations fully capture the potential impact on prices, quality, access, drug supply chain resilience, capital market investment, and innovation for new drugs.”
The Task Force is seeking public comment from health policy experts, economists, attorneys, scientists, health care practitioners, academics, and consumers on several questions, including:
- What theories of harm should enforcement agencies consider when evaluating pharmaceutical mergers, including theories of harm beyond those currently considered?
- What is the full range of a pharmaceutical merger’s effects on innovation? What challenges arise when mergers involve proprietary drug discovery and manufacturing platforms?
- In pharmaceutical merger review, how should we consider the risks or effects of conduct such as price setting practices, reverse payments, and other ways in which pharmaceutical companies respond to or rely on regulatory processes?
- How should we approach market definition in pharmaceutical mergers, and how is that implicated by new or evolving theories of harm?
- What evidence may be relevant or necessary to assess, and if applicable, challenge a pharmaceutical merger based on any new or expanded theories of harm?
- What types of remedies would work in the cases to which those theories are applied?
- What factors, such as the scope of assets and characteristics of divestiture buyers, influence the likelihood and success of pharmaceutical divestitures to resolve competitive concerns?
Those interested in submitting comments should refer to the notice requesting public comment available on regulations.gov. The comment period closes on June 25, 2021.
Additionally, the FTC will host a press conference on May 16, where Slaughter will discuss the initiative with the media in further detail.
“Given the high volume of pharmaceutical mergers in recent years, amid skyrocketing drug prices and ongoing concerns about anticompetitive conduct in the industry, it is imperative that we rethink our approach toward pharmaceutical merger review,” said Slaughter. “Working hand in hand with international and domestic enforcement partners, we intend to take an aggressive approach to tackling anticompetitive pharmaceutical mergers.”