Antitrust & Competition Healthcare Year In Review 2023

• Published date: 19 March 2024
• Law Firm: Goodwin Procter LLP
• Author: Andrew Lacy, Arman Oruc, John Goheen and Andrew Jensen

2023 saw a significant uptick in antitrust scrutiny and enforcement, particularly in the healthcare space. After much rhetoric and a setback in challenging state Certificate of Public Advantage (COPA) laws, the Federal Trade Commission (FTC) brought its first challenge to a private equity "roll-up" scheme and successfully blocked two mergers late in 2023. However, neither of the FTC's merger wins relied on new theories of harm advanced by the antitrust agencies in recent years. Rather, the FTC found success by asserting traditional antitrust claims that the combination of two direct competitors would reduce head-to-head competition and harm customers.

Building on these recent victories, there is little doubt that the antitrust agencies will continue to closely examine healthcare transactions. Although the FTC found recent success using its more traditional playbook, we expect the antitrust agencies will continue to probe more "novel" theories of harm, such as "serial" or "roll-up" acquisitions, the effects of mergers on labor, and transactions involving competitively sensitive data. Each topic was a key part of the antitrust agencies' healthcare rhetoric in 2023, and we do not expect them to deviate from this path in 2024.

2023 Enforcement Roundup

FTC success in challenge to IQVIA-Propel acquisition
In late December, a federal judge agreed with the FTC that IQVIA's acquisition of Propel Media would likely violate federal antitrust laws by combining two of the three top providers of programmatic advertising to healthcare professionals and issued an order preventing the transaction from closing. ¹ Less than a week later, IQVIA called off the proposed acquisition. The FTC initially filed the action in July 2023 after a prolonged Second Request investigation.

The FTC alleged that Propel's DeepIntent and IQVIA's Lasso Marketing are two of the top three demand-side platforms (DSPs) that provide programmatic advertising'an automated form of targeted advertising to healthcare professionals'and that the planned acquisition would result in reduced competition. ² In addition, the FTC raised concerns based on the role that IQVIA's healthcare data business plays for other DSPs, alleging IQVIA would have the ability to disadvantage its competitors by restricting their access to such data. ³

Judge Ramos of the Southern District of New York agreed with the FTC's arguments that the merger would reduce competition for programmatic advertising to healthcare professionals. In the opinion, Judge Ramos adopted the FTC's narrow characterization of the number of competitors in the market (being limited to three primary DSPs) and rejected the defendants' argument that more general, non-healthcare-specific DSPs and social media platforms are viable competitors in providing programmatic advertising to healthcare professionals. ⁴

Notably, Judge Ramos found that the transaction would presumptively have anticompetitive effects because the merged company would have a market share greater than 30%. In reaching this conclusion, Judge Ramos relied heavily on a US Supreme Court decision from the 1960s that made it relatively easy for the government to show mergers would harm competition based on market shares alone. ⁵ Later Supreme Court decisions softened the decision relied upon by Judge Ramos, making it more difficult for the government to show that a merger would be anticompetitive by requiring courts to consider additional...