The Bureau of Competition of the Federal Trade Commission (FTC) and Antitrust Division of the Department of Justice (DOJ) announced they would be providing expedited guidance to companies embarking on procompetitive collaborations during the COVID-19 pandemic. In their Joint Statement, the agencies set a goal of responding to all COVID-19 related requests within seven calendar days “of receiving all necessary information.” The FTC will use its Advisory Opinion Process, while the DOJ will use its Business Review Process. The agencies also will endeavor to expeditiously process requests filed under the National Cooperative Research and Production Act to ensure the proper formation of joint ventures.
The FTC has outlined its procedure for COVID-19 expedited staff advisory opinions. That opinion will be in effect for one year from the date of response, and the requesting party may ask the FTC to “reiterate its intention not to challenge the conduct, if further time is necessary to respond to COVID-19 and its aftermath.” The DOJ’s process is outlined on its webpage.
Due to time constraints, the agencies recognize that businesses may have to act quickly and aim to assist in that endeavor by reminding businesses of specific positions taken by the agencies, including:
- Collaboration on research and development is typically procompetitive.
- Sharing information on technical know-how may be necessary for certain collaborations “to achieve the procompetitive benefits of certain collaborations.” Alternatively, there are “safety zones” identified by the FTC for information sharing.
- Private lobbying efforts are typically protected under the Noerr-Pennington Doctrine, including lobbying for federal emergency relief.
- Most joint purchasing agreements among health care providers, “such as those designed to increase the efficiency of procurement and reduce transaction costs,” do not raise antitrust concerns.
- Absent extraordinary circumstances, the agencies are unlikely to challenge the development of suggested practice parameters aimed at clinical decision-making that “may provide useful information to patients, providers, and purchasers.”
The agencies also assure businesses that the exigent circumstances of the COVID-19 pandemic will be taken into account during any analysis, e.g., the need to combine production facilities or distribution networks for COVID-19-related supplies.
At the same time, the agencies warn against engaging in price gouging and other anticompetitive activities by those who wish to take advantage of these trying times. The agencies have repeated their willingness to enforce antitrust laws and seek appropriate civil and, in the DOJ’s purview, criminal penalties. To this end, the DOJ has requested anyone with information concerning illegal schemes taking advantage of the pandemic to report any information to it.
Ballard Spahr's Antitrust and Competition Group has experience in counseling businesses in all markets, including all facets of the health care market, regarding antitrust risk and seeking advisory opinions from the agencies.
Copyright © 2020 by Ballard Spahr LLP.
www.ballardspahr.com
(No claim to original U.S. government material.)
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, including electronic, mechanical, photocopying, recording, or otherwise, without prior written permission of the author and publisher.
This alert is a periodic publication of Ballard Spahr LLP and is intended to notify recipients of new developments in the law. It should not be construed as legal advice or legal opinion on any specific facts or circumstances. The contents are intended for general informational purposes only, and you are urged to consult your own attorney concerning your situation and specific legal questions you have.