Global Antitrust Enforcers Outline Priorities
Earlier this month, antitrust lawyers and enforcers from around the globe convened in Washington, D.C., for the annual American Bar Association (ABA) Antitrust Spring Meeting. This prestigious gathering represents the largest event for the antitrust community each year, providing valuable insights as enforcers preview their enforcement agendas and policy objectives for the coming months.
In a notable departure from tradition, federal enforcers did not join the official spring meeting due to disputes with the ABA regarding policy statements. However, Federal Trade Commission (FTC) Chairman Andrew Ferguson and Assistant Attorney General (AAG) of the U.S. Department of Justice Antitrust Division Gail Slater participated in a separate panel discussion where they outlined the federal agencies’ perspectives on critical antitrust issues and enforcement priorities.
Healthcare and Pharma Remain Primary Enforcement Targets
Consistent with previous years, pharmaceutical and healthcare markets dominated discussions and were identified as continuing focal points for regulatory scrutiny. This emphasis comes as no surprise to industry observers, given two key factors: first, the inherently local nature of healthcare markets makes them particularly suitable targets for state antitrust enforcement; second, the pharmaceutical industry faces relentless public scrutiny regarding pricing and market practices.
Both state and federal enforcers strongly emphasized that recent investigative trends examining labor practices—specifically noncompete provisions and no-poach agreements—will intensify in the coming years. This represents a significant continuity of enforcement philosophy despite administrative changes.
For businesses operating in these heavily scrutinized sectors, proactive assessment of potential antitrust vulnerabilities has become essential to effectively mitigate regulatory risks before they materialize into formal investigations.
Federal Enforcers Maintain Focus on Pharmaceutical Industry
Antitrust oversight of pharmaceutical companies has long been a cornerstone of federal antitrust enforcement strategy, and the current administration appears determined to maintain this tradition. While federal enforcers were somewhat reserved regarding specific policy initiatives, they unambiguously committed to continued rigorous oversight of pharmaceutical industry practices.
Although the new administration has yet to initiate its first pharmaceutical antitrust case, two specific issues appear poised to remain under intense FTC scrutiny:
- Orange Book listings: The previous administration sent formal notifications to multiple pharmaceutical companies alleging that over 100 patents were improperly included in the Orange Book, suggesting their inclusion potentially violated antitrust law. Further emphasizing this concern, the FTC filed an amicus brief in a private litigation case advancing similar arguments.
- Reverse payment settlements: The FTC maintains regular monitoring and reporting on reverse payment settlements—specifically Hatch-Waxman settlements where the agency believes a branded drug manufacturer provides some form of compensation to a generic competitor in exchange for settlement terms. In its most recent analysis, the FTC highlighted an increase in “quantity restrictions” within patent settlements—arrangements where generic manufacturers agree to market only limited quantities of competing products for specified periods. The agency indicated that certain implementations of these restrictions may constitute antitrust violations.
The Orange Book listing controversy demonstrates a critical pattern: once the FTC publicly identifies certain pharmaceutical company practices as potentially violating antitrust laws, class-action firms and private plaintiffs frequently initiate litigation to test these theories. While not an exhaustive inventory of potential vulnerabilities, these highlighted areas demand particularly careful consideration from pharmaceutical businesses seeking to minimize antitrust exposure in the coming years.
Healthcare Provider Enforcement Continues with Bipartisan Support
Another significant focus of federal antitrust oversight continues to be healthcare provider markets. Regulatory enforcement regarding healthcare providers has historically enjoyed strong bipartisan support, which panelists broadly agreed would likely continue under the current administration. During the previous leadership, the Lina Khan-led FTC unanimously challenged several significant hospital mergers, including proposed combinations between HCA Healthcare and Steward Health Care System, Novant Health and Community Health Systems, and RWJBarnabas Health and Saint Peter’s Healthcare System.
Panelists did identify one area where the administrations may diverge significantly: consent decrees. They anticipate the current administration will demonstrate greater openness toward remedies and pre-litigation settlements compared to their predecessors. For example, when hospital chains propose mergers, the current administration may be more inclined to allow transactions to proceed if merging entities agree to divest facilities that create competitive overlaps. However, experts cautioned that while agencies may show increased receptiveness to settlements, this should not be interpreted as willingness to accept remedies perceived as insufficient to address competitive concerns.
State Enforcement Expands to Fill Potential Federal Gaps
Throughout the spring meeting discussions, state enforcement authorities emphasized their readiness to address any potential enforcement gaps that might emerge under the new federal administration.
This increased state involvement could significantly impact healthcare antitrust matters in several important ways:
First, healthcare markets fundamentally operate as local markets, and state attorneys general often possess comparable or superior knowledge about local market conditions within their jurisdictions compared to merging parties themselves. This effectively neutralizes any informational advantages that merging entities might otherwise hold over federal enforcement agencies.
Second, state enforcers bring additional regulatory tools to healthcare merger enforcement. Some states, such as California, have begun leveraging their charitable trust laws to review nonprofit hospital mergers. Other states have assigned healthcare merger review responsibilities to specialized regulatory agencies—including Pennsylvania’s Insurance Department and California’s Office of Health Care Affordability. Additionally, numerous states have implemented or are actively considering healthcare-specific premerger notification requirements, which would provide those states with insights into proposed transactions that might not trigger reporting requirements at the federal level.
State enforcement representatives also expressed criticism regarding the FTC’s position on Certificates of Public Advantage (COPAs), which provide written approvals from state health departments that both authorize and shield healthcare mergers from state and federal antitrust review. Historically and again recently, the FTC has maintained opposition to COPAs, drawing criticism from states that believe factors like healthcare access carry equal importance to competitive considerations. While panelists acknowledged continued divergence between FTC and state perspectives on COPAs, they suggested states have generally prevailed in this dispute, particularly after a federal court ruling determined that Hart-Scott-Rodino filings are not required for mergers exempt from Clayton Act provisions (including those protected by COPAs).
Labor Market Enforcement Remains a Priority
Antitrust investigations targeting labor practices and labor market considerations in merger reviews represented a distinctive feature of the Biden administration’s enforcement approach. Many analysts had predicted the incoming administration would adopt a more permissive stance on these issues; however, both state and federal enforcement officials explicitly indicated they continue to view noncompete clauses and no-poach agreements as problematic market practices, with widespread belief that noncompete provisions remain excessively utilized in employment contracts.
Indeed, Ferguson and Slater specifically characterized vigorous enforcement regarding noncompete clauses as an essential component of an “America First” antitrust policy framework. This focus is further evidenced by numerous private class actions related to noncompete and no-poach agreements, including several within the healthcare sector.
As healthcare providers and pharmaceutical companies routinely incorporate these provisions in employment agreements with physicians, researchers, and specialized professionals, maintaining awareness of these enforcement priorities becomes increasingly important. Organizations should ensure employment agreements contain narrowly tailored restrictions clearly connected to legitimate business objectives to minimize potential antitrust exposure.
