Wednesday, February 8, 2012
For those who have been following disputes over drug shortages: late last year there was an interesting intervention from the American Antitrust Institute (AAI). As the AAI notes, "shortages ... illustrate the relationship between competition and public policy in healthcare." The AAI worries that certain business practices may be exacerbating drug shortages:
We set forth the basis for the concern that certain bundled discounting practices in the market for important pediatric and teenage (henceforth “pediatric”) vaccines may be anticompetitive. A number of recent cases (e.g., LePage’s Inc., v. 3M and FTC v. Intel) have given antitrust authorities the opportunity to reflect on the correct analytical frameworks for evaluating the competitive effects of bundled discounts and market-share or volume discounts. Because vaccination has positive spillover effects on those that are not immunized, the harms resulting from exclusionary bundled discounts also extend to the general population. This highlights the integral role that competition policy plays in achieving broader public policy goals in healthcare. As the lead antitrust agency in this area, the FTC is ideally positioned to probe bundled discounts involving vaccines to determine if further action is necessary.
Given extant antitrust concerns about GPO's, this is an area that bears further attention.