Federal Trade Commission Sues Surescripts, Alleging Anti-Competitive Practices


The Federal Trade Commission (FTC) recently announced a
lawsuit against Surescripts, a widely known health information exchange company,
for illegally performing vertical and horizontal restraints upon the electronic
prescribing (e-prescribing) process. Specifically, the FTC alleges the company
was trying to obtain a monopoly over the routing and eligibility of
e-prescribing. According to HealthPayer Intelligence, which
first reported the story, commissioners voted 5-0 to file a complaint. “For the
past decade, Surescripts has used a series of anticompetitive contracts
throughout the e-prescribing industry to eliminate competition and keep out
competitors,” said FTC Bureau of Competition Director Bruce Hoffman in a press
release. “Surescripts’s illegal contracts denied customers and, ultimately,
patients, the benefits of competition—including lower prices, increased output,
thriving innovation, higher quality, and more customer choice.”

According to the FTC, Surescripts monopolized both the
routing portion and the eligibility portion of the e-prescribing process. While
the routing portion allows physicians to send their prescriptions to
pharmacies, the eligibility portion enables physicians to electronically
determine a patient’s eligibility for prescription coverage through access to
their insurance. The FTC maintains that the company successfully stopped
various attempts to increase competition within these two portions of the e-prescribing
market for years, and asserts that the complaint filed this month is aiming to
prevent Surescripts from initiating further unfair methods of competition, to
restore competition within the market, and to provide compensation to
consumers. The FTC further alleges that the company intentionally sought to
prevent customers from using other platforms through exclusivity agreements,
threats, and other anticompetitive tactics. Furthermore, the FTC alleges the
company specifically sought to increase costs of e-prescription through their
exclusivity contracts, even as the market saw “explosive growth of routing and
eligibility transactions—from nearly 70 million routing transactions in 2008 to
more than 1.7 billion in 2017.”

This isn’t the first time the FTC has weighed in on prescribing practices in recent months. As the agency’s press release highlights, this February commissioners “reached a global settlement with the pharmaceutical manufacturer Teva Pharmaceuticals Industries Ltd., barring the company from engaging in reverse-payment patent settlement agreements that block consumers’ access to lower-priced generic drugs.” They’ve also settled with pharmaceutical giant AbbVie in a monopoly case, and charged Impax Laboratories, alleging that the company was blocking consumer access to generic drugs.

Click here to read the Health Payer Intelligence article on the FTC charges.

Click here to read the FTC press release on the charges against Surescripts.


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