FTC partners with foreign regulators for ‘aggressive’ review of pharmaceutical industry

The Federal Trade Commission, in conjunction with foreign governments, is pushing a new effort to overhaul regulation of the pharmaceutical industry.

Alongside the Justice Department and state attorneys general offices nationwide, the FTC said Tuesday that it formed a working group with government regulators in Canada, Europe and the United Kingdom to change the way they crack down on pharmaceutical mergers.

“Given the high volume of pharmaceutical mergers in recent years, amid skyrocketing drug prices and ongoing concerns about anticompetitive conduct in the industry, it is imperative that we rethink our approach toward pharmaceutical merger review,” said Rebecca Kelly Slaughter, FTC acting chair, in a statement. “Working hand-in-hand with international and domestic enforcement partners, we intend to take an aggressive approach to tackling anticompetitive pharmaceutical mergers.”

Among the questions that the FTC said the regulatory coalition is working to answer is, “What evidence would be needed to challenge a transaction based on any new or expanded theories of harm?”

Congress is also looking to have a say in answering that question as federal lawmakers have offered several antitrust proposals since Democrats took control of Congress. While Republicans and Democrats have worked together on proposals aimed at curbing large tech platforms’ alleged market dominance, Sen. Amy Klobuchar has proposed a more sweeping change of antitrust policy. 

Ms. Klobuchar, Minnesota Democrat in charge of the Senate’s antitrust panel, has proposed lowering the standards used to curb alleged monopolistic power in the market. Ms. Klobuchar said at a hearing last week she sees monopolies in everything from “cat food to caskets.”

Republicans, however, are skeptical of a complete overhaul of antitrust policy. Sen. Mike Lee, Utah Republican and the top GOP senator on the antitrust panel, said at a hearing last week that a sweeping transformation of antitrust policy was not needed. He has previously said undermining the consumer welfare standard, a metric used to determine whether a business’ conduct merits antitrust action, was a nonstarter for Republicans. 

If federal lawmakers do not change antitrust law, the FTC’s new activity in the pharmaceutical realm signals the Biden administration may be willing to rethink federal antitrust policy without Congress.