The Trump II antitrust team is mostly in place. Andrew Ferguson is the Chair at the Federal Trade Commission (FTC) and together with Commissioner Holyoak and likely to be confirmed Mark Meador, there will soon be three (3) Republican commissioners. At the Department of Justice Antitrust Division (DOJ) Gail Slater has already been confirmed and taken the reins.
While the recent firings by President Trump of Commissioner Kelly Slaughter and Commissioner Alvaro Bedoya have caught the headlines, it is unclear what the impact will be, if any, on antitrust enforcement. The early healthcare antitrust enforcement signals are that DOJ and FTC will stay the course. An early example of this approach is found in the third-party subpoenas issued by the DOJ in its investigation of UnitedHealth Group’s proposed acquisition of Amedisys, a home-health and hospice provider. The DOJ subpoenas request information on the labor markets for nurses and how those markets might be impacted by the transaction. Such questions were typically not the focus of merger investigations prior to the Biden Administration. Also unlikely to change is the FTC’s approach to evaluating the competitive effects of hospital and provider transactions, or the DOJ’s investigations into the competitive effects of vertical consolidation of providers and payers.
Ferguson and Slater have also expressed support for the 2023 Merger Guidelines, issued in December 2023 after a multiyear review and drafting process. The 2023 Merger Guidelines significantly revised the prior approach to both horizontal and vertical transactions, including lowering the market concentration thresholds at which there is a presumption of competitive harm, targeting industry “roll ups”—where a firm serially acquires smaller firms in the same industry—and identifying as problematic transactions that allow access to a rival’s competitively sensitive data. Significant revisions to the Hart-Scott-Rodino filing requirements found in the Premerger Notification Form Final Rule went into effect on February 5, 2025. These changes are the first significant update to the HSR form since 1976. The new form requires the parties to provide substantial information regarding competitive overlaps, ownership, supply relationships, and markets. Parties will need to allocate more time to completing the form prior to filing, understanding that the information provided could lock them into certain positions if the transaction is challenged.
The investigations into the role of pharmacy benefit managers (PBMs) in the cost of prescription drugs also seem likely to move forward, with the FTC continuing its investigations. The FTC is pursuing a Rule 6(b) study of the “competitive impact of the [PBMs] contracting and business practices . . .” and is expected to issue a Final report within the next year. In September 2024, the FTC filed an administrative complaint against Caremark Rx, Express Scripts, and Optum Rx–the three largest PBMs–for their alleged role in artificially inflating the price of insulin. The complaint alleges that the PBMs and their affiliated group purchasing organizations have engaged in unfair methods of competition in violation of Section 5 of the FTC Act by creating a drug rebate system that prioritizes higher rebates from drug manufacturers and excludes lower priced insulin. The one wildcard: Chair Ferguson and Commissioner Holyoak are both recused from the lawsuit. With Meador likely to be the lone commissioner that can make determinations regarding this matter, it is unclear what the impact will be on the FTC’s case.
Submitted by Baker Donelson