Tag: Health Care

The Commission required laboratory testing companies Laboratory Corporation of America Holdings and Orchid Cellmark Inc. to divest a portion of Orchid's paternity testing business, to resolve the FTC complaint alleging that LabCorp's $85.4 million acquisition of Orchid would have an anticompetitive impact in the market for paternity testing services used by government agencies. Under the proposed settlement order, the portion of Orchid's U.S. paternity testing business that is focused on sales to government agencies, and related assets, will be sold to another testing company, DNA Diagnostics Center (DDC). On 2/1/2012, the FTC approved a final order.

The FTC required Universal Health Services, Inc., one of the nation’s largest hospital management companies, to sell 15 psychiatric facilities as a condition of its $3.1 billion acquisition of Psychiatric Solutions, Inc. As originally proposed the acquisition would have reduced competition in the provision of acute inpatient psychiatric services in three local markets: Delaware, Puerto Rico, and metropolitan Las Vegas, Nevada.

The Commission required dialysis services company DaVita, Inc. to sell 29 outpatient dialysis clinics around the United States, under a settlement that resolves FTC charges that DaVita’s proposed $689 million acquisition of rival CDSI I Holding Company, Inc., also known as DSI, would be anticompetitive. The settlement preserves competition in 22 geographic markets where the FTC alleges that consumers would be harmed by DaVita’s acquisition of DSI. The settlement requires DaVita to sell the clinics to Dialysis Newco, Inc., a corporation formed by venture capital firms Frazier Healthcare and New Enterprise Associates.

In 2006, Ovation Pharmaceuticals, manufacturer of Indocin, a drug used in the treatment of patent ductus arteriosus, a congenital heart defect usually found in severely underweight premature babies, purchased the rights to the drug NeoProfen, a drug about to receive FDA approval for the treatment of the same condition which effects approximately 30,000 babies per year in the United States.  After its FDA approval, Ovation released its NeoProfen treatment, charging similar prices. According to the Commission’s complaint, Ovation’s acquisition was intended to maintain its monopoly in the market for this treatment, and the Commission sought divestiture of assets related to one of the two treatments, and also disgorgement of all unlawfully obtained profits from the sale of these two treatments. In August 2010, the district court dismissed the complaint, finding that the two drugs were in separate product markets. The Commission, along with the State of Minnesota, has appealed the court’s ruling to the Eighth Circuit. On August 19, 2011 the Eighth Circuit affirmed the district court's decision. FTC and Minnesota filed a petition for rehearing en banc on October 3, 2011, and the petition was denied.  The FTC closed its investigation.

An association representing 900 physicians in the Amarillo, Texas, area agreed to a Commission order barring it from jointly negotiating the prices it charges insurance providers. The FTC alleged in a complaint filed with the order that the association, Southwest Health Alliances, Inc., d/b/a BSA Provider Network, has violated federal law since 2000 by fixing the prices its member doctors would charge insurers. The Commission's order requires the association to cease and desist.

The Commission required Hikma Pharmaceuticals PLC (Hikma) to divest two generic injectable pharmaceuticals – phenytoin and promethazine – as part of a settlement allowing it to acquire certain assets from Baxter Healthcare Corporation, Inc. (Baxter). Hikma proposes to acquire Baxter’s entire generic injectable pharmaceutical business for $111.5 million, including Baxter’s Cherry Hill, New Jersey, manufacturing facility and a warehouse and distribution center in Memphis, Tennessee. Phenytoin is an anti-convulsant drug used to control and prevent seizures during or after surgery and Promethazine is used to prevent some types of allergies or allergic reactions, to prevent or control motion sickness, nausea, vomiting, and dizziness, and to help patients go to sleep and control their pain or anxiety before or after surgery.