Federal Register / Vol. 84, No. 232 / Tuesday, December 3, 2019 / Notices 66191

the Assistant Attorney General, patterns, devices, manufacturing filed with and accepted, subject to final developed the HSR Rules and the processes, or customer names. approval, by the Commission, has been corresponding Notification and Report placed on the public record for a period Form. Heather Hippsley, of thirty (30) days. The following On September 11, 2019, the Deputy General Counsel. Analysis to Aid Public Comment Commission sought comment on the [FR Doc. 2019–26075 Filed 12–2–19; 8:45 am] describes the terms of the consent reporting requirements associated with BILLING CODE 6750–01–P agreement and the allegations in the the HSR Rules and corresponding complaint. An electronic copy of the Notification and Report Form. 84 FR full text of the consent agreement 47951. No relevant comments were FEDERAL TRADE COMMISSION package can be obtained from the FTC received. Pursuant to the OMB [File No. 191 0061] Home Page (for November 15, 2019), on regulations, 5 CFR part 1320, that the World Wide Web, at https:// implement the PRA, 44 U.S.C. 3501 et Bristol-Myers Squibb Company and www.ftc.gov/news-events/commission- seq., the FTC is providing this second Celgene Corporation; Analysis of actions. opportunity for public comment while Agreement Containing Consent Orders You can file a comment online or on seeking OMB approval to renew the pre- To Aid Public Comment paper. For the Commission to consider existing clearance for those information your comment, we must receive it on or collection requirements. AGENCY: Federal Trade Commission. before January 2, 2020. Write ‘‘Bristol- The following discussion presents the ACTION: Proposed consent agreement; Myers Squibb Company and Celgene FTC’s PRA burden analysis regarding request for comment. Corporation; File No. 191 0061’’ on your completion of the Notification and comment. Your comment—including Report Form. For more details about the SUMMARY: The consent agreement in this your name and your state—will be requirements of the HSR Rules, the matter settles alleged violations of placed on the public record of this background behind these information federal law prohibiting unfair methods proceeding, including, to the extent collection provisions, and the basis for of competition. The attached Analysis of practicable, on the https:// the calculations summarized below, see Agreement Containing Consent Orders www.regulations.gov website. 84 FR 47951. to Aid Public Comment describes both Postal mail addressed to the Likely Respondents: Merging Parties. the allegations in the complaint and the Commission is subject to delay due to Estimated Annual Hours Burden: terms of the consent orders—embodied heightened security screening. As a 181,091 hours [derived from 4,894 non- in the consent agreement—that would result, we encourage you to submit your index filings × 37 hours/each) + (five settle these allegations. comments online through the https:// index filings × two hours/each) + (one DATES: Comments must be received on www.regulations.gov website. withdrawn transaction later restarted × or before January 2, 2020. If you prefer to file your comment on three hours)]. ADDRESSES: Interested parties may file paper, write ‘‘Bristol-Myers Squibb Estimated Annual Cost Burden: comments online or on paper, by Company and Celgene Corporation; File $83,301,860, which is derived from No. 191 0061’’ on your comment and on × following the instructions in the $460/hour 181,091 hours. Request for Comment part of the the envelope, and mail your comment to the following address: Federal Trade Request for Comment SUPPLEMENTARY INFORMATION section Commission, Office of the Secretary, Your comment—including your name below. Write: ‘‘Bristol-Myers Squibb Company and Celgene Corporation; File 600 Pennsylvania Avenue NW, Suite and your state—will be placed on the CC–5610 (Annex D), Washington, DC public record of this proceeding at the No. 191 0061’’ on your comment, and file your comment online at https:// 20580; or deliver your comment to the https://www.regulations.gov website. following address: Federal Trade Because your comment will be made www.regulations.gov by following the instructions on the web-based form. If Commission, Office of the Secretary, public, you are solely responsible for Constitution Center, 400 7th Street SW, you prefer to file your comment on making sure that your comment does 5th Floor, Suite 5610 (Annex D), paper, mail your comment to the not include any sensitive personal Washington, DC 20024. If possible, following address: Federal Trade information, such as anyone’s Social submit your paper comment to the Commission, Office of the Secretary, Security number; date of birth; driver’s Commission by courier or overnight 600 Pennsylvania Avenue NW, Suite license number or other state service. identification number, or foreign CC–5610 (Annex D), Washington, DC Because your comment will be placed country equivalent; passport number; 20580, or deliver your comment to the on the publicly accessible website at financial account number; or credit or following address: Federal Trade https://www.regulations.gov, you are debit card number. You are also solely Commission, Office of the Secretary, solely responsible for making sure that responsible for making sure that your Constitution Center, 400 7th Street SW, your comment does not include any comment does not include any sensitive 5th Floor, Suite 5610 (Annex D), sensitive or confidential information. In health information, such as medical Washington, DC 20024. particular, your comment should not records or other individually FOR FURTHER INFORMATION CONTACT: Kari include any sensitive personal identifiable health information. In Wallace (202–326–3085), Bureau of information, such as your or anyone addition, your comment should not Competition, Federal Trade else’s Social Security number; date of include any ‘‘trade secret or any Commission, 600 Pennsylvania Avenue birth; driver’s license number or other commercial or financial information NW, Washington, DC 20580. state identification number, or foreign which . . . is privileged or SUPPLEMENTARY INFORMATION: Pursuant country equivalent; passport number; confidential’’—as provided by Section to Section 6(f) of the Federal Trade financial account number; or credit or 6(f) of the FTC Act, 15 U.S.C. 46(f), and Commission Act, 15 U.S.C. 46(f), and debit card number. You are also solely FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2)— FTC Rule 2.34, 16 CFR 2.34, notice is responsible for making sure that your including in particular competitively hereby given that the above-captioned comment does not include any sensitive sensitive information such as costs, consent agreement containing a consent health information, such as medical sales statistics, inventories, formulas, order to cease and desist, having been records or other individually

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identifiable health information. In in the Consent Agreement requires percentage of body surface area affected addition, your comment should not Celgene to divest all rights and assets and the parts of the body that are include any ‘‘trade secret or any related to its Otezla business to Amgen, affected. Typically, mild psoriasis commercial or financial information Inc. (‘‘Amgen’’). covers less than 3 percent of the body, which . . . is privileged or The proposed Consent Agreement has moderate psoriasis covers 3 to 10 confidential’’—as provided by Section been placed on the public record for percent of the body and severe psoriasis 6(f) of the FTC Act, 15 U.S.C. 46(f), and thirty days for receipt of comments by covers more than 10 percent of the FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2)— interested persons. Comments received body. including in particular competitively during this period will become part of When deciding how to treat psoriasis, sensitive information such as costs, the public record. After thirty days, the dermatologists typically evaluate the sales statistics, inventories, formulas, Commission will review the comments severity of the disease, any risk factors patterns, devices, manufacturing received and decide whether it should or contraindications for the patient, and processes, or customer names. withdraw, modify, or make the Consent the patient’s preferences. Dermatologists Comments containing material for Agreement final. consider efficacy data, safety data, and which confidential treatment is Pursuant to an Agreement and Plan of side effect profile of each product, as requested must be filed in paper form, Merger dated as of January 2, 2019, BMS well as mode of administration to select must be clearly labeled ‘‘Confidential,’’ plans to acquire all of the voting the appropriate treatment course for and must comply with FTC Rule 4.9(c). securities of Celgene in a cash and stock their patients. While many injectable In particular, the written request for transaction with an equity value of and infused products are approved to confidential treatment that accompanies approximately $74 billion (the treat moderate-to-severe psoriasis, a the comment must include the factual ‘‘Acquisition’’). The Commission’s number of patients object to such and legal basis for the request, and must Complaint alleges that the proposed injections or find them inconvenient. identify the specific portions of the Acquisition, if consummated, would For those patients, dermatologists often comment to be withheld from the public violate Section 7 of the Clayton Act, as select an oral product. record. See FTC Rule 4.9(c). Your amended, 15 U.S.C. 18, and Section 5 of Celgene’s apremilast, marketed under comment will be kept confidential only the Federal Trade Commission Act, as the brand name Otezla, is a if the General Counsel grants your amended, 15 U.S.C. 45, by substantially phosphodiesterase 4 inhibitor. Otezla is request in accordance with the law and lessening competition in the U.S. the most popular oral product approved the public interest. Once your comment market for oral products to treat to treat moderate-to-severe psoriasis in has been posted on the public FTC moderate-to-severe psoriasis. The the United States. Several older oral website—as legally required by FTC proposed Consent Agreement will generic products, including Rule 4.9(b)—we cannot redact or remedy the alleged violations by methotrexate and acitretin, are approved remove your comment from the FTC preserving the competition that by the U.S. Food and Drug website, unless you submit a otherwise would be lost in this market Administration (‘‘FDA’’) to treat confidentiality request that meets the as a result of the proposed Acquisition. psoriasis that does not respond to light, topical agents, and other forms of requirements for such treatment under II. The Parties FTC Rule 4.9(c), and the General therapy. These drugs are still Headquartered in New York City, occasionally used in the treatment of Counsel grants that request. BMS researches, develops, Visit the FTC website at http:// psoriasis, but most doctors have moved manufactures, and sells prescription www.ftc.gov to read this Notice and the to prescribing newer agents with better pharmaceutical products and biologic news release describing it. The FTC Act efficacy, better safety, or a more products in several therapeutic areas, and other laws that the Commission favorable side effect profile for patients including oncology, cardiology, administers permit the collection of with moderate-to-severe psoriasis who virology, and inflammatory diseases. public comments to consider and use in desire an oral treatment. BMS is Among other products, BMS is this proceeding, as appropriate. The developing BMS 986165, an oral, developing an oral product to treat Commission will consider all timely selective tyrosine kinase 2 inhibitor that moderate-to-severe psoriasis. Like BMS, and responsive public comments that it is the most advanced oral treatment in Celgene researches, develops, receives on or before January 2, 2020. development for moderate-to-severe manufactures and sells prescription For information on the Commission’s psoriasis. pharmaceutical products in the United privacy policy, including routine uses States. Celgene markets eight products, IV. The Relevant Geographic Market permitted by the Privacy Act, see including an oral treatment for The United States is the relevant https://www.ftc.gov/site-information/ moderate-to-severe psoriasis. geographic market in which to assess privacy-policy. the competitive effects of the proposed III. The Relevant Product and Structure Acquisition. Oral products to treat Analysis of Agreement Containing of the Market Consent Orders To Aid Public Comment moderate-to-severe psoriasis are Psoriasis is a chronic skin disease I. Introduction prescription pharmaceutical products caused by an overactive immune and regulated by FDA. As such, The Federal Trade Commission system. The disease causes skin cells to products sold outside the United States, (‘‘Commission’’) has accepted, subject to multiply faster than normal and leads to but not approved for sale in the United final approval, an Agreement a build-up of cells on the skin surface, States, do not provide viable Containing Consent Orders (‘‘Consent forming bumpy red patches that are competitive alternatives for U.S. Agreement’’) from Bristol-Myers Squibb covered with white scales, known as consumers. Company (‘‘BMS’’) and Celgene plaques. The plaques can appear Corporation (‘‘Celgene’’) designed to anywhere on the body, although they V. Competitive Effects of the remedy the anticompetitive effects are most commonly found on the scalp, Acquisition resulting from BMS’s proposed elbows, knees, and lower back. The The proposed Acquisition would acquisition of Celgene. The proposed severity of psoriasis (mild, moderate, or likely result in substantial competitive Decision and Order (‘‘Order’’) contained severe) is determined based upon the harm to consumers in the market for

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oral products to treat moderate-to-severe determines that Amgen is not an rather like saying an individual psoriasis. Celgene is currently the acceptable acquirer, or that the manner defendant is guilty of a crime because market leader and BMS would likely be of the divestitures is not acceptable, the there is too much of that crime in the next entrant into the market. Upon proposed Order requires BMS and society. Thank goodness that is not how entry, BMS 986165 likely will compete Celgene to unwind the sale of rights and our criminal justice system works. directly with, and take sales from, assets to Amgen and then divest the He next writes that we must approach Otezla. affected product to a Commission- our investigations of pharmaceutical mergers with careful scrutiny and with VI. Entry Conditions approved acquirer within six months of the date the Order becomes final. To great humility. I agree completely. What Entry in the relevant market would ensure compliance with the Order, the I fail to see is how careful scrutiny and not be timely, likely, or sufficient in Commission has agreed to appoint a great humility lead to the conclusion, magnitude, character, and scope to deter Monitor to ensure that BMS and Celgene without any clearly articulated theory of or counteract the anticompetitive effects comply with all of their obligations liability or facts to support it, that this of the proposed Acquisition. New entry pursuant to the Consent Agreement and merger violates the law—or, again would require significant investment of to keep the Commission informed about without any facts in support, that the time and money for product research the status of the transfer of the Otezla remedy is inadequate. and development, regulatory approval rights and assets to Amgen. The The next basis Commissioner Chopra by the FDA, developing clinical history proposed Order further allows the offers for his dissent is his view that the supporting the long-term efficacy of the Commission to appoint a trustee in the merger is animated by financial and tax product, and establishing a U.S. sales event that BMS and Celgene fail to considerations, which he deems and service infrastructure. Such divest the products as required. insufficient to justify the merger. development efforts are difficult, time- The purpose of this analysis is to Leaving aside the question of why he consuming, and expensive, and often facilitate public comment on the thinks the job of antitrust enforcers is to fail to result in a competitive product Consent Agreement, and it is not value-judge a merger beyond its impact reaching the market. intended to constitute an official upon competition, that gets the law VII. The Consent Agreement interpretation of the proposed Order or precisely backwards. The parties get to merge unless we can show a harm to The Consent Agreement eliminates to modify its terms in any way. By direction of the Commission. competition, not the other way round. the competitive concerns raised by the His dissent also alludes to ‘‘distorted’’ proposed Acquisition by requiring BMS April J. Tabor, incentives of the buyer due to the and Celgene to divest Celgene’s Acting Secretary. overlapping ownership of the parties. I worldwide Otezla business, including must admit that the precise meaning of its regulatory approvals, intellectual Statement of Commissioner Noah Joshua Phillips that escapes me. Perhaps it is a property, contracts, and inventory to reference to the theory of ‘‘common I write to address the dissenting Amgen. BMS and Celgene also must ownership’’, which has stoked great statements issued by my colleagues, transfer all confidential business academic debate and about which I have information, research and development Commissioners Chopra and Slaughter. spoken repeatedly.1 Whatever the information, regulatory, formulation, From these statements, a reader meaning, Commissioner Chopra fails to and manufacturing reports related to the unfamiliar with the U.S. antitrust laws articulate how the merger will distort divested products, as well as provide could be forgiven for gleaning several the buyer’s incentives, much less in a access to employees who possess or are inaccurate conclusions. First, way that violates the law. To sue, or to able to identify such information. companies in the U.S. may not merge seek an additional remedy, we need Additionally, to ensure that the unless the antitrust enforcement more. agencies permit them to do so. Second, divestiture is successful and to maintain The dissenting commissioners both to stop a merger, the government need continuity of supply, the proposed criticize the Commission’s not provide any theory as to why a Order requires BMS and Celgene to investigations of pharmaceutical merger violates the law, nor any supply Amgen with Otezla for a limited mergers generally, expressing concern evidence to support that theory. Third, time while Amgen establishes its own that they fail to capture all the harms to antitrust enforcement agencies can and manufacturing capability. The competition posed by such mergers.2 should condemn mergers they cannot provisions of the Consent Agreement But, again, the most they offer is prove violate the law because the ensure that Amgen becomes an speculation about vaguely articulated agencies deem the business independent, viable, and effective harms, without reference to any competitor in the U.S. market. justifications for the merger insufficient. Founded in 1980 and headquartered The unfamiliar reader would be 1 Noah Joshua Phillips, Commissioner, U.S. Fed. in Thousand Oaks, California, Amgen wrong on each count. That is not the Trade Comm’n, Taking Stock: Assessing Common discovers, develops, manufactures and law. (Nor, for that matter, is it sound Ownership, Address at the Global Antitrust sells innovative human pharmaceutical policy.) Economics Conference (June 1, 2018), https:// _ and biologic products. Amgen’s existing The structural remedy agreed to by www.ftc.gov/system/files/documents/public statements/1382461/phillips_-_taking_stock_6-1- business includes products that are the merging parties in this case 18_0.pdf; Noah Joshua Phillips, Commissioner, U.S. highly complementary to the divestiture addresses every competition concern Fed. Trade Comm’n, Competing for Companies: assets. Amgen has the expertise, U.S. uncovered after an extensive How M&A Drives Competition and Consumer sales infrastructure, and resources to investigation. Every one. But Welfare, Address at the Global Antitrust Economics Conference (May 31, 2019), https://www.ftc.gov/ restore the competition that otherwise Commissioners Chopra and Slaughter system/files/documents/public_statements/ would have been lost due to the still dissent. Why? 1524321/phillips_-_competing_for_companies_5- proposed Acquisition. Commissioner Chopra cites a study 31-19_0.pdf. BMS and Celgene must accomplish purporting to show that mergers ‘‘can 2 Like Commissioner Wilson, I believe staff conducted a careful investigation of this merger. the divestitures no later than ten days choke off innovation’’. Okay. But how See Statement of Commissioner Christine S. after consummating the proposed does this merger do that? Without an Wilson, In the Matter of Bristol-Myers Squibb Acquisition. If the Commission answer to that question, the logic is Company/Celgene Corporation.

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evidence that this merger is likely to and Exchange Commission, which members of the Commission also agree exacerbate them. Nor do the dissenters reviews transactions to protect that the remedy in that market—a cite a previous case that resulted in investors.5 Our job is not to opine on complete divestiture of all of Celgene’s anticompetitive effects that they whether a merger is ‘‘good’’ or ‘‘bad’’ for products and associated assets in that insinuate the Commission missed. The society as a whole, or to use our area—will preserve competition in that dissenting statements mention various authority to make sure firms merge for market. Moreover, this $13 billion violations of the antitrust laws reasons that someone might like divestiture is the largest in the history committed by firms in the (innovation) as opposed to reasons that of U.S. merger enforcement. pharmaceutical industry, but neither they may not (tax).6 I agree with Commissioner Slaughter explains how this merger makes such In reviewing the dissenting that pharmaceutical price levels in the conduct more likely. For decades, the statements, readers—unfamiliar and United States today are cause for Federal Trade Commission has pursued otherwise—would do well to keep all of concern. And there is ample evidence enforcement against many different that in mind. that prices of branded pharmaceuticals have increased much faster—perhaps kinds of anticompetitive conduct in the Statement of Commissioner Christine S. six to eight times as fast—as prices in pharmaceutical industry. That work, Wilson critical to controlling healthcare costs the rest of the economy.3 for Americans, will continue. The Commission has accepted, Unfortunately, many of the causes of Neither dissenting commissioner subject to final approval after receiving higher drug prices, including systemic argues that the consent order and public comments, an Agreement distortions created by massive associated divestiture are bad for Containing Consent Order from Bristol- regulatory regimes and a pervasive competition or consumers, or identifies Myers Squibb Company and Celgene principal/agent problem, fall outside the any additional remedy they believe is Corporation that remedies the jurisdiction and legal authority of the warranted. And neither proposes any anticompetitive effect that otherwise Federal Trade Commission. But within basis to sue to stop the merger.3 So, would arise from BMS’s proposed its limited authority as a competition again, why dissent? At the end of the acquisition of Celgene. All members of agency, the Commission can—and day, we are left only with the sense that the Commission (including does—pursue a comprehensive agenda Commissioners Chopra and Slaughter Commissioners Chopra and Slaughter) 1 to address anticompetitive mergers and feel the merger will threaten agree that the only evidence of harm to unlawful conduct in the pharmaceutical competition and wish to dissociate competition that staff found was in the industry. Specifically, the Commission: themselves with it. To me, that is not market for oral products that treat • Carefully Screens Pharmaceutical enough. (Even if it were, a vote to join moderate-to-severe psoriasis.2 All Mergers: Similar to the current Commissioners Chopra and Slaughter enforcement action, the Commission would result, at the end of the day, in 5 See, e.g., 15 U.S.C. 78m(d), 78n(d). routinely has challenged the merger without the remedy. Are 6 This is not to say that we should view financial anticompetitive mergers and or tax considerations as improper motivations for a they calling on their colleagues to vote merger. acquisitions. During the past five years, with them?) 1 See Dissenting Statement of Commissioner the Commission has issued complaints Returning to our unfamiliar reader, Rebecca Kelly Slaughter, In the Matter of Bristol- challenging 13 mergers and required the here is how the law actually works. Myers Squibb and Celgene; Dissenting Statement of divestiture of 130 branded and generic Commissioner Rohit Chopra on Bristol-Myers First, to block a merger outright, U.S. Squibb/Celgene. products to address competitive antitrust enforcement agencies must 2 While Commissioner Chopra agrees that there is overlaps for the sale or development of convince a judge that it violates the law. no evidence of harm to innovation, he concludes particular drugs.4 In this country, where people and that the lack of evidence implies there is a problem with the investigative process. I disagree with 3 companies are free to do what they wish Commissioner Chopra’s hypothesis. See, e.g., Suzanne M. Kirchhoff et al., Congressional Research Service, Frequently Asked with their property subject to the Staff conducted the investigation of this proposed Questions About Prescription Drug Pricing and constraints imposed by the law, our transaction in the same careful manner that all Policy, at 8–9 (Apr. 24, 2018), available at https:// pharmaceutical transactions are investigated. The judges are somewhat hostile to the fas.org/sgp/crs/misc/R44832.pdf (plotting CPI–U notion that we should block a merger investigation examined the likely competition between and among all of BMS and Celgene’s data from the U.S. Bureau of Labor Statistics); when the parties have agreed to address current products and those now in development. Stephen W. Schondelmeyer & Leigh Purvis, AARP every problem that we can identify. The investigation identified a likely harm to Public Policy Institute, Rx Price Watch Report: Second, we need to articulate a viable innovation involving oral products to treat Trends in Retail Prices of Brand Name Prescription moderate-to-severe psoriasis; the identified overlap Drugs Widely Used by Older Americans: 2017 Year- theory of harm to competition posed by includes a product that is still in development by End Update, at 6–8 (Sept. 2018), available at the merger and produce evidence to BMS. In addition, staff investigated whether the https://www.aarp.org/content/dam/aarp/ppi/2018/ support that theory. Third, our job is to proposed transaction would decrease innovation 09/trends-in-retail-prices-of-brand-name- enforce the antitrust laws, which guard competition; instead, the investigation found that prescription-drugs-year-end-update.pdf (using data reduced innovation competition was unlikely. from Truven MarketScan to estimate that ‘‘brand against particular (competitive) harms Moreover, there is no reason to believe there will name drug prices went up more than 8.5 times the that mergers may present. Other parts of be reduced innovation in the pharmaceutical rate of general inflation during [the] 12-year period the government guard against other industry as a result of this transaction. No fewer [from December 31, 2005 to December 31, 2017]’’); harms posed by mergers, for example than 711 companies are conducting late-stage Robert Pearl, How Big Pharma Might Be Cut Down research and development in oncology, the to Size, Forbes.com, May 11, 2017, available at the Committee on Foreign Investment in therapeutic category in which BMS and Celgene https://www.forbes.com/sites/robertpearl/2017/05/ the United States, which looks at certain conduct research. See IQVIA Institute Global 11/how-big-pharma-might-be-cut-down-to-size/ investments for their potential impact Oncology Trends 2019, at 19, May 2019, available (‘‘[A]ccording to the U.S. Bureau of Labor Statistics, on national security,4 or the Securities at https://www.iqvia.com/-/media/iqvia/pdfs/ prices for U.S.-made pharmaceuticals have climbed institute-reports/global-oncology-trends-2019.pdf. over the past decade six times as fast as the cost To support his hypothesis that there must be of goods and services overall.’’); Charles Silver & 3 In fairness, Commissioner Chopra does state his additional unidentified harm to innovation, David A. Hyman, Overcharged: Why Americans Pay view that the agency should litigate to block more Commissioner Chopra seeks to introduce factors Too Much for Health Care 25–27 (2018) (discussing pharmaceutical mergers outright. But he fails to outside the analytical framework demanded by the analyses from Schondelmeyer & Purvis, Pearl, and answer whether the Commission should litigate this statutes enforced by the Commission, including others). case, and—more importantly—on what legal and Section 7 of the Clayton Act, without offering any 4 See Baxter Int’l Inc., Dkt. No. C–4620 (F.T.C. factual basis. That is the question we face today. evidence to show that these non-competition factors July 20, 2017); Amneal Holdings, LLC, Dkt. No. C– 4 See 50 U.S.C. 4565. may reduce innovation. 4650 (F.T.C. Apr. 27, 2018); FTC v. Mallinckrodt

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• Combats Anticompetitive Patent very parties before us today, that claiming the film was safer than tablets Litigation Settlements: In 2013, the FTC allegedly were used obtain unwarranted while having no data to back up the won a landmark victory at the Supreme automatic 30-month stays of FDA claim and significantly raising the price Court in the Actavis case,5 and has approval of generic pharmaceuticals of the tablet when the film was costlier prevailed in subsequent challenges of that would have competed with BMS to make. Under the terms of the similar agreements. For instance, earlier branded products.10 settlement, Reckitt was required to this year, the Commission issued a • Advocates for the Reform of contribute $50 million to a fund to be unanimous opinion condemning a Misused Regulations: The FTC advised distributed to those who were patent litigation settlement after finding the FDA and Congress of possible overcharged.14 that the brand manufacturer possessed abuses of the Risk Evaluation and • Informs Courts of Relevant market power in the market for branded Mitigation Strategy (REMS) framework Competition Principles and Policies: and generic oxymorphone ER, the to forestall competitors’ entry by The Commission has filed briefs as potential generic entrant received a denying access to branded drugs amicus curiae in cases involving patent large and unjustified payment, and the required to conduct bioequivalence litigation settlements,15 REMS and respondent failed to show a cognizable testing, a gating factor for FDA approval restricted distribution systems,16 and justification for the restraint.6 The to launch.11 In remarks before a product hopping.17 Commission’s successful challenges of Subcommittee of the Senate Committee This list of actions by the FTC is by prior settlements have substantially on Commerce, Science, and no means exhaustive.18 But the message reduced the number of anticompetitive Transportation, I encouraged Congress is clear—the FTC uses the full force and patent litigation settlements into which to take action on this front.12 And under weight of its authority to protect companies are entering today. the bipartisan leadership of first consumers from unlawful conduct that • Challenges Abuse of FDA Chairman Bob Pitofsky and then increases prices and reduces innovation Regulatory Processes: The Commission Chairman Tim Muris, the FTC in this important sector of our economy. has brought several cases alleging that conducted a 6(b) study of generic drugs Notwithstanding the Commission’s pharmaceutical companies misuse FDA and issued a report recommending valiant efforts, there are many factors regulatory processes to impede refinements to the Hatch Waxman Act that contribute to increasing drug prices competition. For example, in 2014 the and changes to the FDA regulatory but that are not cognizable under the FTC challenged a pharmaceutical framework, many of which were antitrust laws, and therefore that the company for abusing the litigation implemented, so as to fulfill the original FTC does not have the legal authority to process by filing meritless patent balance of innovation and competition fix. Even if the FTC and other lawsuits against competitors to keep struck by the Hatch Waxman Act. government enforcers did their job • them off the market. The Commission Challenges Novel Anticompetitive won a judgment for $448 million.7 The Strategies As They Arise: Earlier this 14 I was recused from this enforcement action FTC also sued Shire ViroPharma in year the Commission challenged and because, before joining the Commission, I settled a case against Reckitt Benckiser represented a generic drug company before the FTC 2017, alleging anticompetitive abuse of and FDA challenging this anticompetitive conduct. the FDA citizen-petition process to keep Group plc alleging that Reckitt 15 See, e.g., Br. of amicus curiae Federal Trade the FDA from approving the competitive introduced a film version of Suboxone, Commission in Support of Plaintiffs-Appellants, In products, thereby keeping those lower- which treats opioid addiction, and re Lamictal Direct Purchaser Antitrust Litigation, No. 2:12–cv–995, (3d Cir. filed Apr. 28, 2014) cost drugs off the market. pushed the market to use the film version rather than the existing tablet (explaining that a commitment not to introduce an (Unfortunately, the Commission lost the authorized generic product is the type of settlement case on a statutory construction issue version that was about to face generic subject to antitrust scrutiny); Supp. Br. of amicus 13 that kept the Court of Appeals from competition. The complaint alleged curiae Federal Trade Commission in Support of Plaintiffs-Appellants, In re Effexor XR Antitrust ruling on the merits of the allegations.8) that Reckitt pushed the market toward the film and away from the tablets by Litig., No. 3:11–cv–05479 (3d Cir. filed Mar. 17, And under Chairman Tim Muris, the 2016) (explaining that litigation settlements among FTC challenged wrongful listings in the private parties are private commercial agreements FDA Orange Book 9 by BMS, one of the that cover the drug that is the subject of its NDA. and are not exempt from antitrust scrutiny under 21 U.S.C. 355(b)(1). Upon receipt of the patent the Noerr doctrine). information, the FDA is required to list it in an 16 See, e.g., Br. of amicus curiae Federal Trade ARD Inc., No. 1:17-cv-00120 (D.D.C. Jan. 18, 2017); agency publication entitled ‘‘Approved Drug Commission, Mylan Pharmaceuticals, Inc. v. Mylan, N.V., Dkt. No. C–4590 (F.T.C. July 26, 2016); Products with Therapeutic Equivalence,’’ Celgene, No. 2:14–cv–2094 (D.N.J. filed June 17, Teva Pharmaceutical Indus. Ltd., Dkt. No. C–4589 commonly known as the ‘‘Orange Book.’’ Id. 2014) (explaining that a monopolist’s refusal to sell (F.T.C. July 26, 2016); Hikma Pharmaceuticals PLC, § 355(j)(7)(A). to potential competitors may, under certain limited Dkt. No. C–4572 (F.T.C. Mar. 28, 2016); Hikma 10 See Complaint, Bristol-Myers Squibb Co., Dkt. circumstances, violate Section 2 of the Sherman Act Pharmaceuticals PLC, Dkt. No. C–4568 (F.T.C. Feb. No. C–4076 (F.T.C. filed Apr. 14, 2003). and that a brand name drug manufacturer’s patents 26, 2016); Lupin Ltd., Dkt. No. C–4566 (F.T.C. Feb. 11 See, e.g., Statement of the Federal Trade do not reach activities undertaken in connection 18, 2016); Endo Int’l PLC, Dkt. No. C–4539 (F.T.C. Commission to the Department of Health and with bioequivalence testing). Sept. 24, 2015); Pfizer Inc., Dkt. No. C–4537 (F.T.C. Human Services Regarding the HHS Blueprint to 17 See Br. of amicus curiae Federal Trade Aug. 21, 2015); Impax Labs, Inc., Dkt. No. C–4511 Lower Drug Prices and Reduce Out-of-Pocket Costs Commission, Mylan Pharmaceuticals, Inc. v. (F.T.C. Mar. 5, 2015); Novartis AG, Dkt. No. C–4510 (July 16, 2018); Prepared Statement of Markus H. Warner Chilcott Public Ltd. Co., No. 12–cv–3824 (F.T.C. Feb. 20, 2015); Sun Pharmaceutical Indus. Meier, Acting Director, Bureau of Competition, (E.D. Pa. filed Nov. 21, 2012) (explaining that Ltd, Dkt. No. C–4506 (F.T.C. Jan. 30, 2015). Federal Trade Commission before the U.S. House of minor, non-therapeutic changes to a branded 5 FTC v. Actavis, Inc., 570 U.S. 136 (2013). Representatives, Judiciary Committee, pharmaceutical product that harm generic 6 See, e.g., Impax Laboratories, Inc., Dkt. No. 9373 Subcommittee on Regulatory Reform, Commercial competition can constitute exclusionary conduct (F.T.C. April 3, 2019) (Commission Decision). and Antitrust Laws, on ‘‘Antitrust Concerns and the that violates U.S. antitrust laws). 7 FTC v. AbbVie, Inc. 329 F. Supp. 3d 98 (E.D. FDA Approval Process’’ (July 27, 2017). 18 For a complete review of the Commission’s Pa. 2018). 12 See Commissioner Christine S. Wilson, Oral ongoing and extensive efforts to combat 8 FTC v. Shire ViroPharma, Inc., 917 F.3d 147, Statement before Senate Committee on Commerce, anticompetitive mergers and unlawful conduct in 156 (3d Cir. 2019). Science & Transportation, Subcommittee on the pharmaceutical industry, see Markus H. Meier, 9 Pursuant to the FDC Act, a brand-name drug Consumer Protection, Product Safety, Insurance, & Bradley S. Albert, & Kara Monahan, Overview of manufacturer seeking to market a new drug product Data Protection (Nov. 27, 2018). FTC Actions in Pharmaceutical Products and must first obtain FDA approval by filing a New 13 See Joint Motion for Entry of Stipulated Order Distribution (Sept. 2019), available at https:// Drug Application (‘‘NDA’’). At the time the NDA is for Permanent Injunction and Equitable Monetary www.ftc.gov/system/files/attachments/competition- filed, the NDA filer must also provide the FDA with Relief, FTC v. Reckitt Benckiser Group, PLC, No. policy-guidance/20190930_overview_pharma_ certain categories of information regarding patents 1:19–cv–00028 (W.D. Va. filed July 11, 2019). final.pdf.

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flawlessly (and our ‘‘retrospective’’ replaces the competition otherwise lost and pharmaceutical merger activity reviews of our past work suggests we do because of the merger by divesting all of persists at a high pace.4 The high rate quite well), pharmaceutical prices Celgene’s relevant products and assets of drug company consolidation has would still rise for many other reasons. to a new and robust competitor. Rather coincided with a sea change in the For example, last year the Trump than asserting that staff should have structure of pharmaceutical research Administration released two reports found something—anything—more to and development; recent studies suggest identifying various market justify asking a court to block the mergers may inhibit research, imperfections in health care markets, transaction, we should recognize the development, or approval in this including prescription drug markets, limited authority we have been granted changing environment.5 In addition, the and various regulatory and legislative by Congress and encourage other pharmaceutical industry has long been reforms that would increase consumer responsible governmental actors to fix the focus of anticompetitive conduct choice and provider competition.19 the many problems in this sector that lie enforcement by both the Commission Similarly, former FDA Administrator beyond our jurisdiction. and private litigants, including for practices such as pay-for-delay Scott Gottlieb has identified several Dissenting Statement of Commissioner settlements,6 sham litigation,7 and flaws in the market for biosimilars— Rebecca Kelly Slaughter generic biologic medicines—that he anticompetitive product hopping.8 We believes require Congressional action.20 The Federal Trade Commission has a must carefully consider the facts in each And Professors David Hyman (also a long history of reviewing mergers specific merger to understand whether former FTC Special Counsel) and between pharmaceutical manufacturers or how it may facilitate anticompetitive Charles Silver have identified a host of using an analytical framework that conduct, and therefore be more likely to other legal and regulatory factors that identifies specific product overlaps result in a substantial lessening of increase drug prices,21 including FDA between the merging parties, including competition. delays in processing generic of drugs in development, and requiring Going forward, I hope the applications and a Medicare system divestitures of one of those products. Commission will take a more expansive pursuant to which the government This approach addresses significant approach to analyzing the full range of 1 purchases one- third of all retail drugs competitive concerns in these mergers, competitive consequences of but is barred from negotiating the prices but I am concerned that it does not fully that it pays.22 capture all of the competitive in the U.S., at 8 (Apr. 19, 2018); Laura Entis, Why 2 Does Medicine Cost So Much? Here’s How Drug There is broad concern about consequences of these transactions. The consent decree in this case Prices Are Set, Time (Apr. 9, 2019), https:// prescription drug price levels, and I time.com/5564547/drug-prices-medicine/; see also share those concerns. But here, follows the Commission’s standard Joanna Shepherd, The Prescription for Rising Drug Commission staff conducted a thorough approach. It remedies a serious concern Prices: Competition or Price Controls?, 27 Health Matrix 315, 315–16 (2017); Aimee Picchi, Drug investigation and found evidence that about a drug-level overlap between BMS’s development-stage BMS 986165 Prices in 2019 are Surging, With Hikes at 5 Times the acquisition of Celgene by BMS Inflation, CBS News (July 1, 2019), https:// would, if not addressed, diminish (or ‘‘TYK2’’) and Celgene’s on-market www.cbsnews.com/news/drug-prices-in-2019-are- competition in one relevant market. Otezla for the treatment of moderate-to- surging-with-hikes-at-5-times-inflation/. severe psoriasis. This is important, and 4 See Barak Richman, et al., Pharmaceutical M&A Commission staff then negotiated a Activity: Effects on Prices, Innovation, and record-breaking consent agreement that I support the Commission’s effort to remedy this drug-level overlap. Competition, 48 Loy. U. Chi. L. J. 787, 790–91 (2017); Meagan Parrish, What’s Behind all the M&A 19 U.S. Dep’t of Health and Human Servs., However, I remain concerned that this Deals in Pharma, Pharma Manufacturing (July 31, American Patients First: A Trump Administration analytical approach is too narrow. In 2019). Blueprint to Lower Drug Prices and Reduce Out-of- particular, I believe the Commission 5 See Justus Haucap & Joel Stiebale, Research: Pocket Costs (May 2018), available at https:// should more broadly consider whether Innovation Suffers When Drug Companies Merge, www.hhs.gov/sites/default/files/ Harvard Business Review (Aug. 3, 2016); Justus AmericanPatientsFirst.pdf; U.S. Dep’t of Health and any pharmaceutical merger is likely to Haucap & Joel Stiebale, How Mergers Affect Human Servs., U.S. Dep’t of the Treasury, & U.S. exacerbate anticompetitive conduct by Innovation: Theory and Evidence From the Dep’t of Labor, Reforming America’s Healthcare the merged firm or to hinder innovation. Pharmaceutical Industry (2016) (finding a negative System Through Choice and Competition 63–67 Several recent developments enhance effect on research and development activity of the (2018), available at https://www.hhs.gov/sites/ merged firm and rival firms); but see Richman, et default/files/Reforming-Americas-Healthcare- my concerns. Branded drug prices have al., supra note 4 at 799–801, 817–18 (finding a 3 System-Through-Choice-and-Competition.pdf increased substantially in recent years, positive correlation between increased (discussing, e.g., the use of ‘‘any-willing-provider’’ pharmaceutical merger and drug development laws in the context of drug prescription plans and 1 Within the standard analytical framework for activity, but noting competitive concerns about a Medicare Part D). FTC staff consulted with HHS on pharmaceutical mergers, the Commission has done ‘‘bottleneck’’ in FDA approval). the latter report. See id. at 3 (‘‘Executive Order a good job of studying the effects of previous 6 See Press Release, Fed. Trade Comm’n, Last 13813, . . . requires the Secretary of Health and divestitures, and has taken seriously the lesson that Remaining Defendant Settles FTC Suit that Led to Human Services (HHS), in consultation with the divestitures of on-market, rather than pipeline Landmark Supreme Court Ruling on Drug Company secretaries of the Treasury and Labor and the products, are often more likely to succeed in ‘‘Reverse Payments’’ (Feb. 28, 2019), https:// Federal Trade Commission, to provide a report to preserving competition among the overlapping www.ftc.gov/news-events/press-releases/2019/02/ the President.’’). products. See Bruce Hoffman, It Only Takes Two to last-remaining-defendant-settles-ftc-suit-led- 20 Scott Gottlieb, Op-Ed, Don’t Give Up on Tango: Reflections on Six Months at the FTC, at 6 landmark-supreme. Biosimilars—Congress Can Give Them a Boost, (Feb. 2, 2018). 7 See Press Release, Fed. Trade Comm’n, Wall St. J., Aug. 25, 2019, https://www.wsj.com/ 2 The Commission has been very successful in Statement of FTC Chairman Joe Simons Regarding articles/dont-give-up-on-biosimilarscongress-can- negotiating settlements with merging parties to Federal Court Ruling in FTC v. AbbVie (June 29, give-them-a-boost-11566755042. address drug overlaps. The Commission has not 2018), https://www.ftc.gov/news-events/press- 21 See, e.g., Charles Silver & David A. Hyman, recently litigated pharmaceutical merger cases, and, releases/2018/06/statement-ftc-chairman-joe- Here’s a Plan to Fight High Drug Prices that Could although merger litigation in other industries and simons-regarding-federal-court-ruling. Unite Libertarians and Socialists, Vox.Com, June merger guidelines provide useful guidance, we 8 See Press Release, Fed. Trade Comm’n, Reckitt 21, 2018, https://www.vox.com/the-big- idea/2018/ simply do not have a contemporary body of Benckiser Group plc to Pay $50 Million to 6/21/17486128/prescription-drug-prices- pharmaceutical merger caselaw to clarify the Consumers, Settling FTC Charges that the Company monopolies-epipen-shkreli-sanders-patents-prizes; boundaries for our analytical approach. Illegally Maintained a Monopoly over the Opioid see also Statement of Commissioner Rebecca Kelly 3 See IQVIA Institute for Human Data Science, Addiction Treatment Suboxone (July 11, 2019), Slaughter, supra note 1, at 2 n.10 (citing Silver & The Global Use of Medicine in 2019 and Outlook https://www.ftc.gov/news-events/press-releases/ Hyman approvingly). to 2023, at 11 (Jan. 29, 2019); IQVIA Institute for 2019/07/reckitt-benckiser-group-plc-pay-50-million- 22 See Silver & Hyman, supra note 3, at 53–60. Human Data Science, Medicine Use and Spending consumers-settling-ftc.

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pharmaceutical mergers. I urge not only When it comes to life-saving analysis and sources of evidence,4 while the Commission, but also researchers pharmaceuticals, the Federal Trade avoiding assumptions that may be and industry experts to think carefully Commission should never ignore outdated. Given some of the clear and creatively about these cases, and in serious warning signs that most warning signs in the industry, we must particular to study the effects of recent Americans see clearly. Many of us approach our investigations of consummated mergers on drug research, depend on prescription drugs to pharmaceutical mergers with careful development, and approval. Outside of survive, but too many cannot afford the scrutiny and great humility about our merger enforcement, we should also high costs. The argument that sky-high longstanding practices. continue to police aggressively business prices are necessary for innovation has This massive $74 billion merger practices that suppress competition. been falling apart, as more evidence between Bristol-Myers Squibb (NYSE: Indeed, as Commissioner Chopra and I reveals that many new drugs seem to be BMY) and Celgene (NASDAQ: CELG) have explained elsewhere, we should designed to extend exclusivity, rather may have significant implications for unleash the full scope of our authority than providing meaningful therapeutic patients and inventors, so we must be under Section 5 to combat high drug benefits.1 especially vigilant. In my view, this prices.9 Predicting the anticompetitive effects transaction appears to be heavily The problem of high drug prices is too of massive mergers in any industry is motivated by financial engineering 5 and important to leave any potential difficult. This is especially true in tax considerations 6 (as opposed to a solutions unexhausted. As a society, we pharmaceuticals, where research and genuine drive for greater discovery of should also consider all other policy discovery are core to competition. Some life-saving medications), without clear interventions that would help combat evidence shows that these mergers have benefits to patients or the public. The high drug prices.10 choked off innovation,2 creating harms buyer’s incentives might also be 7 Dissenting Statement of Commissioner that are immeasurable for those waiting distorted, given overlaps in ownership. Rohit Chopra for a cure. 4 I have previously noted that the agency can Summary Routine vs. Rigor enhance its assessments of the likelihood of entry by new innovators, as well as its approach to • Today’s troubles in the Over the years, the agency has worked vetting the financial condition of divestiture buyers. pharmaceutical industry are well to combat abuse of intellectual property Statement of Commissioner Rohit Chopra, In the known. Drug pricing is out-of-control and other anticompetitive conduct by Matter of Fresenius Medical Care AG & Co. KGaA and NxStage Medical, Inc. (Feb. 19, 2019), https:// and innovation is too slow. Given the pharmaceutical companies, achieving www.ftc.gov/public-statements/2019/02/statement- consequences for human life, the FTC major victories in courts across the commissioner-chopra-matter-fresenius-medical- must ensure fierce competition in this country. Our approach to care-ag-co-kgaa; Statement of Commissioner Rohit market through close scrutiny of pharmaceutical mergers, however, has Chopra, In the Matter of Linde AG, Praxair, Inc., and Linde PLC (Oct. 22, 2018), https://www.ftc.gov/ mergers and conduct. focused primarily on reaching public-statements/2018/10/statement- • The agency has scored big victories settlements, rather than litigation or in- commissioner-chopra-matter-linde-ag-praxair-inc- in court to combat anticompetitive depth merger studies. The agency has linde-plc. conduct in the industry. But, when it focused on seeking divestitures of 5 This transaction will lead to changes in the individual products, usually to another merged firm’s capital structure, as well as an comes to mergers, Commissioners have acceleration of share buybacks. I fear that these typically voted to steer clear of the major pharmaceutical player. changes will alter the firm’s incentives in ways that courtroom, instead focusing on There have been longstanding, might increase the likelihood of anticompetitive settlements that address product bipartisan concerns about whether this conduct. See Bristol-Myers Squibb, Press Release, Bristol-Myers Squibb Announces Agreement overlaps. strategy is truly working. For example, ® • Between Celgene and Amgen to Divest OTEZLA Given the size and potential impact in 2005, as he reflected on his six years for $13.4 Billion (Aug. 26, 2019, 6:30 a.m.), https:// of this massive merger, I am skeptical of service as Commissioner, Thomas news.bms.com/press-release/corporatefinancial- that the status quo approach will Leary lamented that the agency’s news/bristol-myers-squibb-announces-agreement- uncover the range of potential harms to approach to these investigations mostly between-celgene-and-a. 6 Tax avoidance appears to be one of the primary American patients. stayed the same, despite overarching motivations of the deal, rather than a meaningful concerns about other anticompetitive increase in the firms’ ability to innovate or operate 9 See Statement of Commissioners Rohit Chopra harms.3 effectively. See, e.g., Siri Bulusu, Celgene Holders and Rebecca Kelly Slaughter Regarding the Federal May See Tax Benefit From Bristol-Myers Deal (1), Trade Commission Report on the Use of Section 5 During my time as a Commissioner, I Bloomberg Tax (Jan. 4, 2019, 4:43 p.m.), https:// to Address Off-Patent Pharmaceutical Price Spikes, have pushed for the agency to be more news.bloombergtax.com/daily-tax-report/celgene- (June 27, 2019). rigorous across all of our work by holders-may-see-tax-benefit-from-bristol-myers- 10 The problem of high drug prices has prompted opening our eyes to new types of deal-1 (noting that the buyer went out of its way a number of proposed policy solutions in addition to make sure the stock component of the merger to antitrust enforcement, including (1) reference will be taxable and describing how that tax would pricing, (2) reforming import restrictions, (3) 1 Donald W. Light & Joel R. Lexchin, be deductible by Celgene shareholders). Tax innovation prizes, and (4) Medicare Part D price Pharmaceutical R&D: What do we get for all that considerations were also relevant to Amgen, the negotiation. See So-Yeon Kang, et al., Using money?, 345 British Med. J. 22, 24 (2012), https:// Commission’s approved buyer of a divested asset. External Reference Pricing in Medicare Part D to www.bmj.com/bmj/section-pdf/187604?path=/bmj/ Amgen publicly disclosed that it would recognize Reduce Drug Price Differentials With Other 345/7869/Analysis.full.pdf. $2.2 billion in tax benefits, on a present value basis. Countries, 5 Health Aff. 38 (2019); Tim Wu, How 2 See generally, Justus Haucap & Joel Stiebale, See Michael Erman & Manas Mishra, Amgen to buy to Stop Drug Price Gouging, N.Y. Times (Apr. 20, How Mergers Affect Innovation: Theory and Celgene psoriasis drug Otezla for $13.4 billion, 2017), https://www.nytimes.com/2017/04/20/ Evidence from the Pharmaceutical Industry Reuters (Aug. 26, 2019), https://www.reuters.com/ opinion/how-to-stop-drug-price-gouging.html; (Du¨ sseldorf Inst. for Competition Economics, article/us-bristol-myers-divestiture-amgen/amgen- Charles Silver & David A. Hyman, Here’s a Plan to Discussion Paper No. 218, 2016), http:// to-buy-celgene-psoriasis-drug-otezla-for-13-4- Fight High Drug Prices That Could Unite www.dice.hhu.de/fileadmin/redaktion/Fakultaeten/ billion-idUSKCN1VG102. Libertarians and Socialists, Vox (Jun. 21, 2018), Wirtschaftswissenschaftliche_Fakultaet/DICE/ 7 For example, I noted with great interest that https://www.vox.com/the-big-idea/2018/6/21/ Discussion_Paper/218_Haucap_Stiebale.pdf. two-thirds of Bristol-Myers Squibb’s 100 largest 17486128/prescription-drug-prices-monopolies- 3 Interview with Commissioner Thomas B. Leary, shareholders also have stakes in Celgene, according epipen-shkreli-sanders-patents-prizes; Juliette 19 (3) A.B.A. Antitrust Health Care Chronicle 1, 5 to data assembled by Refinitiv. See, e.g., Svea Cubanski & Tricia Neuman, Searching for Savings (2005), https://www.ftc.gov/public-statements/2005/ Herbst-Bayliss & Michael Erman, Starboard joins in Medicare Drug Price Negotiations, Henry J. 09/health-care-interview-commissioner-thomas-b- opposition to Bristol-Myers’ $74 billion Celgene Kaiser Family Foundation (Apr. 26, 2018). leary. Continued

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In addition, there are also concerns I am deeply skeptical that this SUMMARY: The Centers for Disease about a history of anticompetitive approach can unearth the complete set Control and Prevention (CDC) in the conduct.8 Expansive investigation for of harms to patients and innovation, Department of Health and Human mergers like these is time well spent. based on the history of anticompetitive Services (HHS) announces the opening Again, with a few exceptions,9 many conduct of the firms seeking to merge of a docket to obtain public comment to FTC Commissioners have primarily and the characteristics of today’s identify topics of public health scrutinized pharmaceutical mergers pharmaceutical industry when it comes importance that will form the basis of based on an examination of whether to innovation. Will the merger facilitate Community Preventive Services Task there are any product overlaps between a capital structure that magnifies Force (CPSTF) evidence-based the merging corporations, or where incentives to engage in anticompetitive recommendations. CDC will use this there may be clear-cut incentives to conduct or abuse of intellectual information to support the CPSTF in its foreclose rivals with the ability to property? Will the merger deter selection of priority topics to guide its compete.10 When there are no obvious formation of biotechnology firms that work over the next five years. This overlaps or foreclosure possibilities, the fuel much of the industry’s innovation? docket will provide the opportunity to Commission typically does not How can we know the effects on expand the current body of knowledge challenge any aspect of the competition if we do not rigorously and identify important evidence gaps. transaction.11 study or investigate these and other DATES: Written comments must be critical questions? Given our approach, received on or before January 23, 2020. deal, Reuters (Feb. 28, 2019, 6:59 a.m.), https:// I am not confident that the Commission ADDRESSES: You may submit comments, www.reuters.com/article/us-celgene-m-a-bristol- has sufficient information to determine identified by Docket No. CDC–2019– myers-wellington/starboard-joins-opposition-to- the full scope of potential harms to 0112, by any of the following methods: bristol-myers-74-billion-celgene-deal- • idUSKCN1QH1K7. competition of this massive merger. Federal eRulemaking Portal: http:// 8 www.regulations.gov. Follow the For example, last year, the Food & Drug Conclusion Administration published a list of drug makers that instructions for submitting comments. were the subject of complaints that they had The financial crisis and the Great • Mail: Julie Zajac, Centers for restricted generic drug companies from accessing Recession taught our country a tough Disease Control and Prevention, Office drug samples, which enable generic firms to develop viable alternatives. Celgene was a top lesson: When watchdogs wear of the Associate Director for Policy and recipient of these complaints. Alison Kodjak, How blindfolds or fail to evolve with the Strategy, Community Guide Office, 1600 a Drugmaker Gamed The System To Keep Generic marketplace, millions of American Clifton Road NE, Mail Stop V25–5, Competition Away, NPR (May 17, 2018; 5:00 a.m.), families can suffer the consequences. Atlanta, GA 30329. https://www.npr.org/sections/health-shots/2018/05/ 17/571986468/how-a-drugmaker-gamed-the-system- The regulators and enforcers of the Instructions: All submissions received to-keep-generic-competition-away. mortgage industry failed to stop the must include the agency name and 9 See, e.g., Statement of the Federal Trade widespread abuses that plagued the Docket Number. All relevant comments Commission, In the Matter of Teva Pharmaceuticals marketplace. And there are many more received will be posted without change Industries Ltd. and Allergan plc (July 27, 2016), to http://regulations.gov, including any https://www.ftc.gov/public-statements/2016/07/ examples every year, from the opioid statement-federal-trade-commission-matter-teva- crisis to the failures of the Boeing 737 personal information provided. For pharmaceuticals-industries; cf. Concurring Max, where blindfolded regulators and access to the docket to read background Statement of Commissioner J. Thomas Rosch, the absence of rigorous investigation documents or comments received, go to Federal Trade Commission v. Ovation http://www.regulations.gov. Pharmaceuticals, Inc. (Dec. 16, 2008), https:// proved to be catastrophic to human life, www.ftc.gov/public-statements/2008/12/concurring- despite so many warning signs. FOR FURTHER INFORMATION CONTACT: Julie statement-commissioner-j-thomas-rosch-federal- When enforcers conduct wide- Zajac MPH, Community Guide Office, trade-commission. ranging, intensive inquiries that do not Office of the Associate Director for 10 In this matter, the Analysis of Agreement uncover unlawful conduct, then, of Policy and Strategy, Centers for Disease Containing Consent Orders to Aid Public Comment focuses primarily on a specific product market course, they cannot take action. Control and Prevention, 1600 Clifton overlap. This is similar to many past analyses However, when they wear blindfolds or Road NE, Mail Stop V25–5, Atlanta, GA contained in public notices seeking comment on cling to the status quo, they cannot 30329. Phone: 404–498–1827; Email: proposed consent orders in the FTC’s assume that the public is protected. [email protected]. pharmaceutical merger actions. See, e.g., Analysis For these reasons, I respectfully Of Agreement Containing Consent Orders To Aid SUPPLEMENTARY INFORMATION: dissent. Public Comment, In the Matter of Boston Scientific Public Participation Corporation, File No. 191–0039, https:// [FR Doc. 2019–26074 Filed 12–2–19; 8:45 am] www.ftc.gov/system/files/documents/cases/191_ Interested persons or organizations _ _ _ BILLING CODE 6750–01–P 0039 boston scientific aapc.pdf; Analysis Of are invited to participate by submitting Agreement Containing Consent Orders To Aid Public Comment, In the Matter of Amneal Holdings, written views, recommendations, and LLC, Amneal Pharmaceuticals LLC, Impax DEPARTMENT OF HEALTH AND data. In addition, CDC invites comments Laboratories, Inc., and Impax Laboratories, LLC, HUMAN SERVICES specifically on the following questions: File No. 181–0017, https://www.ftc.gov/system/ 1. What public health topics should files/documents/cases/1810017_amneal_impax_ analysis_4-27-18.pdf. See also Markus Meier et al., Centers for Disease Control and be prioritized for CPSTF systematic Fed. Trade Comm’n, Overview of FTC Actions In Prevention reviews assessing the effectiveness and Pharmaceutical Products and Distribution (2019), economic merits of public health https://www.ftc.gov/system/files/attachments/ [Docket No. CDC–2019–0112] programs, services, and other competition-policy-guidance/overview_pharma_ _ interventions? june 2019.pdf. Priority Topics for the Community 2. What is the rationale for choosing 11 For example, in January 2015 the Commission Preventive Services Task Force granted early termination of the Hart-Scott-Rodino these topics? waiting period and took no enforcement action (CPSTF); Request for Information 3. What are examples of published against the proposed $66 billion merger between AGENCY: Centers for Disease Control and studies on interventions within these Actavis plc and Allergan, Inc. See Fed. Trade Prevention (CDC), Department of Health topics? Comm’n, Early Termination Notices, 20150313: Possible domains to consider in Actavis plc; Allergan, Inc. (Jan. 9, 2015), https:// and Human Services (HHS). answering these questions include (but www.ftc.gov/enforcement/premerger-notification- ACTION: Request for information. program/early-termination-notices/20150313. are not limited to):

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