Surescripts has moved to dismiss the Federal Trade Commission’s charge from earlier this year that it holds an illegal monopoly on the e-prescribing market.
WHY IT MATTERS
This past April, the FTC alleged that Surescripts “intentionally set out to keep e-prescription routing and eligibility customers on both sides of each market from using additional platforms (a practice known as multihoming) using anticompetitive exclusivity agreements, threats, and other exclusionary tactics.”
FTC said its suit aims to counter that outsized influence and competition in the marketplace and to provide “monetary redress to consumers.”
But in filing its motion to dismiss this past Friday, Surescripts countered that the agency’s charge should be tossed out, since it rests upon a several factual misreadings.
For example, FTC points to Surescripts’ contracts with Epic as an example of a loyalty provision, but the company asserts that its contract with the EHR vendors doesn’t an exclusivity requirement. Moreover, it says the FTC is incorrect when it claims that nearly all of Surescripts’ contracts with Epic customers also contain such requirements.
FTC also says the e-prescribing vendor’s contracts have a penalty provision it claims would discourage EHR companies from using multiple networks or switching away from Surescripts, requiring that those vendors repay loyalty incentives that they’d previously earned. But Surescripts claims there is no such requirement for EHR vendors to return incentive payments earned following a notice of termination, and says and such companies are free terminate agreements with just six months’ notice.
More generally, Surescripts counters that FTC misrepresents the dollars and cents realities of the e-prescribing market, making what it says is a theoretical claim that drug prices could have fallen by more than the 70% Surescripts managed to achieve. And it says the regulatory agency can’t support its claim that Surescripts’ alleged market monopoly led to lower quality and reduced innovation.
In its motion to dismiss, Surescripts lists several other antitrust case precedents that show, it says, that FTC is seeking to stretch the boundaries of its regulatory mandate.
THE LARGER TREND
For its part, FTC has said its case against Surescripts was just part of its larger ongoing efforts to end anti-competitive practices that put consumers at a disadvantage and raise the cost of care.
“Surescripts’ illegal contracts denied customers and, ultimately, patients, the benefits of competition – including lower prices, increased output, thriving innovation, higher quality, and more customer choice,” said FTC Bureau of Competition Director Bruce Hoffman in April. “Through this litigation, we hope to eliminate the anticompetitive conduct, open the relevant markets to competition, and redress the harm that Surescripts’s conduct has caused.”
ON THE RECORD
“We continue to be disappointed at the allegations made by the Federal Trade Commission,” Surescripts CEO Tom Skelton said in a statement. “We wholeheartedly share the FTC’s focus on lowering healthcare costs, and we have achieved significant reductions with e-prescribing for many years. However, the FTC’s complaint makes significant factual errors about Surescripts’ business and mischaracterizes the economic realities of the e-prescribing market.
“It is important to highlight that while the cost of American healthcare overall continues to rise, Surescripts has reduced the cost of e-prescribing by 70% since 2009, a goal we will continue to focus on as a critical part of our business,” he added. “There is no question that e-prescribing has brought enormous value to patients and clinicians alike through innovations in accuracy, safety and convenience.”
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