J&J divesting wrist-fracture treatment to proceed with Synthes deal

Johnson & Johnson agreed to sell its system for treating serious wrist fractures in order to resolve the Federal Trade Commission's antitrust concerns with the company's $21.3 billion deal to buy Synthes.

According to an FTC administrative complaint (PDF), Synthes—a Swiss company with U.S. headquarter in West Chester, Pa.—in 2010 controlled 42% of the U.S. market for volar distal radius plating systems, which are surgically implanted on the underside of the wrist to repair fractures. New Brunswick, N.J.-based J&J's DVR system, meanwhile, accounted for 29% of the market in that year, according to the complaint. The FTC argued that the deal would eliminate J&J's only significant competitor for the devices and allow the company to unilaterally raise prices.

“This order will ensure that the hospitals and surgeons that use these systems to care for consumers will not face higher prices or reduced innovation in the future,” Richard Feinstein, director of the FTC's Bureau of Competition, said in a news release.

Although the FTC's concerns were limited to the wrist plating systems, J&J intends to sell its entire trauma portfolio to Biomet, Warsaw, Ind., according to an FTC news release.

When J&J announced the deal in late April, executives noted the market for trauma products as an opportunity for growth brightened by bringing Synthes into its fold.

J&J's agreement with the FTC (PDF) is subject to public comment for 30 days before the commission decides whether to make it final.