Recent DOJ Action Creates Uncertainty For Information-Sharing Programs

• Jurisdiction: United States,Federal
• Law Firm: Pillsbury Winthrop Shaw Pittman
• Subject Matter: Antitrust/Competition Law, Food, Drugs, Healthcare, Life Sciences, Criminal Law, Antitrust, EU Competition
• Author: Michael Sibarium, Alvin Dunn and Evan Storm
• Published date: 08 March 2023

TAKEAWAYS

• Companies that participate in an information exchange should share sensitive information only with the association (or outside firm) that is operating the information exchange.
• Participants should decide independently whether and how to use the information provided by the information exchange.
• Associations and participants should carefully monitor the government's future policy statements and enforcement actions relating to information exchanges.

The U.S. Department of Justice (DOJ) recently withdrew three antitrust policy statements ¹ that had provided guidance for information sharing by competitors and that DOJ had issued jointly with the Federal Trade Commission (FTC) starting 30 years ago. DOJ said that the guidance in those statements was "overly permissive on certain subjects, such as information sharing." ²

The DOJ announcement creates uncertainty for information-sharing programs because the antitrust safety zone set forth in the policy statements, although on its face limited to the health care field, had been applied by DOJ to areas outside of health care and had been relied upon by parties-including many associations, professional societies and other nonprofits-when establishing their information-sharing programs.

DOJ did not issue new guidance but instead stated that it would be using "a case-by-case enforcement approach" going forward, making it likely that it will take some time before we know whether information-sharing programs that operate within the antitrust safety zone that had been relied upon for years could be subject to legal challenge.

The "Antitrust Safety Zone" Relied upon for Years

The DOJ/FTC policy statements included an "antitrust safety zone" that made the exchange of price and cost information by health care providers presumptively legal if three criteria were met:

1. The information was collected, aggregated and disseminated by a third party;
2. The exchanged information was more than three months old and
3. At least five providers supplied the exchanged information, no single provider accounted for more than 25 percent of the exchanged information, and the disseminated information was sufficiently aggregated to protect the identity of the underlying sources of the information ³

This safety zone permitted competitors to participate in information-sharing programs, which the government recognizes can have significant consumer benefits, but sought to ensure that participating competitors did not gain access to...