FTC v. Lundbeck: Is Anything in Antitrust Obvious, Like, Ever?

Authors

Chris Sagers, Cleveland-Marshall College of Law, Cleveland State UniversityFollow
Richard M. Brunell, American Antitrust InstituteFollow

Document Type

Article

Publication Date

Fall 2014

Publication Title

The Antitrust Bulletin

Keywords

horizontal mergers, monopolies, hospitals, drugs, price competition, Lundbeck, pharmaceuticals, market definition

Abstract

In FTC v. Lundbeck, the Eighth Circuit affirmed a bench verdict finding a merger to monopoly, followed by a 1400% price increase, not only legal, but effectively not even subject to antitrust. The result followed from the district court's view that peculiarities in the market for hospital-administered drugs rendered it essentially immune from price competition. That being the case, the court found that even products very plainly substitutable on any traditional "functional interchangeability" analysis are not in the same "relevant market" for purposes of rules governing horizontal mergers. We think the court's analysis was incorrect for a number of factual reasons, but stress that, much more importantly, a case like Lundbeck calls for return to traditionally broad, prophylactic rules.

Repository Citation

Sagers, Chris and Brunell, Richard M., "FTC v. Lundbeck: Is Anything in Antitrust Obvious, Like, Ever?" (2014). Law Faculty Articles and Essays. 796.
https://engagedscholarship.csuohio.edu/fac_articles/796

Volume

59

Issue

3