The FTC, New York and six other states filed suit against Vyera Pharmaceuticals and its former CEO, Martin Shkreli, alleging anticompetivie conduct in connection with Daraprim, the only FDA approved drug for the treatment of the life-threatening parasitic disease toxoplasmosis. The suit alleges that Vyera purchases the unpatented and widely available drug in 2015 and…
Merger of two clinical laboratories in California
Federal Trade Commission (FTC) and the Plaintiff States sought to enjoin the merger between Albertson’s Inc. (Albertson’s) and American Stores Company (American Stores), alleging that the merger would substantially impair competition in the supermarket industry and could result in price increases and decreases in the quality and selection of food, groceries and
Challenge to proposed merger involving Ralphs Grocery Company (owning both Ralphs Markets and Food 4 Less markets) and Hughes Markets. Case settled by divestiture of 19 stores in 7 areas in southern California.
Texas v. Your Therapy Source, LLC et al., No. D-1-GN-18-003887 (Travis Cty. Dist. Ct., 201st Dist. July 31, 2018)
The state alleged that the owners of two companies that provided professional therapists to home health agencies, including physical,occupational and speech therapists and therapist assistants, agreed to reduce the rate of pay for therapists and invited other competitors to collude on the rates. The FTC entered into a settlement with the companies. The state entered into a settlement with the companies that enjoined them from agreeing on rates with their competitors, exchanging rate information with their competitors,attempting to collude with any competitor on rates of pay for therapists. The companies were also required to submit compliance reports. the order is in effect for 20 years.
FTC and Plaintiff States v. Mallilnckrodt Ard Inc. (formerly Questcor), No. 1:17-cv-00120 (D.D.C. Jan. 18, 2017)
Four states and the FTC reached a $100 million settlement with Mallinckrodt plc and its US subsidiary, formerly known as Questcor Pharmaceuticals, Inc. resolving a lawsuit accusing Questcor of monopolizing the market for Achthar, the only adrenocorticotropic hormone (ACTH) based therapeutic drug sold in the United States. ACTH is used as a last resort to treat infantile spasms and multiple sclerosis. Questcor allegedly blocked competition for Acthar by disrupting the bidding process and acquiring the U.S. rights for Synacthen Depot, the only other ACTH based drug sold in the world. In 2001, Questcor bought the rights to Acthar and increased the price of it by 85,000 percent, charging over $34,000 for a vial of the drug that used to cost $40 per vial. In 2012, Novartis Pharma A.G sold the U.S. rights of Synacthen, Achthar’s only competitor. The complaint alleges that three other companies had all conducted due diligence and submitted formal offers for Synacthen with plans to develop and launch Synacthen in the United States in direct competition with Questcor. However, perceiving the threat to its U.S. monopoly if a rival drug company purchased the assets, Questcor stepped in to outbid the three other companies, offering Novartis $135 million in guaranteed payments with only vague plans for Synacthen and after very limited due diligence. Through the acquisition, Questcor sought to extinguish the most likely challenges to its Acthar monopoly. According to the complaint, this allowed Questcor to continue charging over $34,000 per vial for H.P. Acthar Gel. In addition to paying $100 million in disgorgement, Under the settlement, Mallinckrodt will pay $100 million. The company will also be required to license a competitor to the rights it acquired from Novartis to commercialize and develop Synacthen in the United States, including the Synacthen trademark, along with clinical trial data and certain intellectual property related to manufacturing and formulation. Mallinckrodt is also prohibited from taking actions that would interfere with clinical trials or clinical plans for Synacthen.
In May 2015, the FTC settled a “pay-for-delay” suit against Cephalon for injunctive relief and $1.2 billion, which was paid into an escrow account. The FTC settlement allowed for those escrow funds to be distributed for settlement of certain related cases and government investigations. In August 2016, forty-eight states filed suit in the Eastern District of Pennsylvania against Cephalon alleging anticompetitive conduct by Cephalon to protect the profits it earned from having a patent-protected monopoly on the sale of its landmark drug, Provigil. According to the complaint, Cephalon’s conduct delayed generic versions of Provigil from entering the market for several years. The complaint alleged that as patent and regulatory barriers that prevented generic competition to Provigil neared expiration, Cephalon intentionally defrauded the Patent and Trademark Office to secure an additional patent, which a court subsequently deemed invalid and unenforceable. Before it was declared invalid, Cephalon was able to use the patent to delay generic competition for nearly six additional years by filing patent infringement lawsuits. Cephalon settled those lawsuits by paying competitors to delay sale of their generic versions of Provigil until at least April 2012. Consumers, states, and others paid millions more for Provigil than they would have had generic versions of the drug launched by early 2006, as expected. A settlement was filed with the complaint, which includes $35 million for distribution to consumers who bought Provigil.
Plaintiff states and FTC filed suit challenging the merger of Ahold and Delhaize, supermarket chains operating in the United States as Stop & Shop and Hannafords. According to the complaint, supermarkets operated by Ahold and Delhaize compete closely for shoppers based on price, format, service, product offerings, promotional activity, and location. Without a remedy, the merger would eliminate direct supermarket competition to the detriment of consumers in these local markets. As a result, the merger would increase the likelihood that the combined company could unilaterally exercise market power, and that the remaining competitors could coordinate their behavior to raise prices. the parties agreed to divest 76 supermarkets in the plaintiff states. The settlement also required prior notification of future supermarket purchases and $300,000 in attorneys fees and costs.
The FTC and the state of North Dakota filed suit seeking to block Sanford Health’s proposed acquisition of Mid Dakota Clinic, alleging that the deal would violate antitrust law by significantly reducing competition for adult primary care physician services, pediatric services, obstetrics and gynecology services, and general surgery physician services in the greater Bismarck and Mandan metropolitan area. Sanford and Mid Dakota were each other’s closest rivals in the four-county Bismarck-Mandan region of North Dakota, and the merger would create a group of physicians with at least 75 to 85 percent share in the provision of adult primary care physician services, pediatric services, obstetrics and gynecology services. The district court granted the injunction. The Eighth Circuit Court of Appeals affirmed, and the parties abandoned the transaction.
Eighteen plaintiff states and the FTC challenged the merger of Dollar Tree, the largest chain of “dollar” stores (deep discount stores) and Family Dollar Stores, the nation’s third largest dollar store chain. The complaint claimed the proposed acquisition would substantially lessen competition in numerous markets by: (1) eliminating direct and substantial competition between Dollar Tree and Family Dollar; and (2) increasing the likelihood that Dollar Tree will unilaterally exercise market power. This, according to the complaint, would violate Section 7 of the Clayton Act and each state’s applicable antitrust and consumer protection laws. The states sought a permanent injunction to prevent the merger, along with costs and attorney fees. The parties reached a settlement under which 330 stores in the 18 states would be divested to Sycamore partners and run as a new dollar store chain, Dollar Express. The agreement also required the defendants to report future acquisitions in any of the affected markets and to pay over $865,000 to reimburse the costs and fees of the plaintiff states.