Such a statement might come as little surprise to pharmaceutical companies, which watched the FTC fight all the way to the U.S. Supreme Court—and win—to gain the right to challenge out-of-court settlements that delay the entry of generic drugs to the market. That case, FTC vs. Actavis, was sent back to the trial court that initially tossed it out for new proceedings.
Meanwhile, hospitals watched the FTC go to the Supreme Court—and win again—to unwind the acquisition of a hospital in southwest Georgia that left a six-county area with one acute-care health system. In that case, the FTC opted to settle and allow the two hospitals to be operated by Phoebe Putney Health System. But that was after years of litigation.
The FTC also is awaiting rulings from judges in provider-acquisition cases in Ohio and Idaho. Several other healthcare deals have unraveled in recent years at the mere threat of FTC litigation.
“The FTC has been at the forefront of these issues, preventing proposed provider mergers that threaten higher costs without related improvements in quality of care,” Ramirez told the committee during her portion of Friday's two-hour hearing (video).
With all the merger activity and pharmaceutical-patent litigation going on across the nation, how does the agency decide where to step in? Subcommittee Chairman Rep. Spencer Bachus (R-Ala.) lamented federal antitrust agencies' lack of “transparency and predictability” in how they decide what cases to pursue.
“The FTC's failure to establish a clear standard … has created uncertainty for businesses and resulted in costly litigation that could be avoided,” he said. “And this is not a recent development. This has been over multiple administrations.”
Meanwhile, though, some policymakers and experts who study healthcare consolidation say the FTC and the U.S. Justice Department haven't been vigilant enough, and that the growing pace of consolidation has driven up healthcare prices.
Rep. John Conyers (D-Mich.) said he'd like to see antitrust enforcement become even more vigorous. “We should be especially skeptical of any detriment to consumers presented by a rapid succession of big mergers in a given industry,” Conyers said. “Basic economics and common sense should tell us that having a few dominant firms forces consumers to pay higher prices and to accept sub-optimal products or services.”
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