When presidential administrations change, so can the tactics and goals of federal agencies, and the Federal Trade Commission (FTC) is no different. While we will not know the Biden FTC appointees for some time, members of the transition team for the FTC have indicated one goal should be cracking down on the enforcement of antitrust laws.
Any companies – in healthcare and other industries – planning possible mergers or acquisitions in the coming year should be aware of possibly tougher antitrust requirements. It is important for any company engaging in these transactions to have the guidance of an experienced antitrust lawyer who can help them navigate a successful deal whenever possible.
One aspect of enforcement the transition team is examining is granting or denying healthcare mergers. The current administration engaged in years-long battles against certain mergers, many of which were ultimately approved above the dissent of certain commissioners. These include:
- Mylan acquiring Pfizer’s Upjohn
- AbbVie acquiring Allergan
With the changing administration, it might be more challenging for healthcare mergers to get FTC approval and close. When issues arise with the FTC during an M&A, it can cause delays and be a costly process for all involved. Always have the right law firm representing your company during the merger process. Experienced antitrust lawyers will know how to communicate with the FTC during the investigation to give you the best chance of approval.
Preventing Pay-for-Delay Schemes
Another tactic that might be targeted applies to pharmaceutical companies and their “pay-for-delay” agreements. In these agreements, brand name drug companies aim to settle patent litigation by offering generic drug companies compensation to delay the launch of their generic – and more cost-effective – pharmaceuticals. This tactic often effectively stifles competition from generic companies and prevents consumers from having lower-cost alternatives on the market. It is estimated that pay-for-delay tactics result in an additional $3.5 billion in drug costs for consumers than they would pay for generic options. We will be watching how the new FTC team will tackle this matter.
Not Just Healthcare
While the healthcare and pharmaceutical industries are certainly major antitrust concerns of the FTC due to skyrocketing prices and dwindling options for patients, there are other industries that raise concerns for the FTC due to an increasing concentration of companies resulting from under-enforcement. These reportedly include:
Comments also indicated that the new FTC leaders would continue big tech investigations and lawsuits, including against Google, Facebook, and possibly Amazon and Apple.
With potentially tougher enforcement of antitrust and anticompetition laws, corporations might face additional challenges when it comes to growth in the market. This makes it even more important to have the right legal representation to help your corporation with successful transactions whenever possible.