Bundling Identical Products: An Economic Analysis

This article considers whether or not the bundling of two identical products is usefully treated as a tying arrangement. Following Prof. Williams’ article in this issue, I discuss three tying cases in which the defendants bundled two products that were arguably identical. Of the three, I focus on the EpiPen case. Bundling two identical products might appear to be a tying arrangement because the purchase of one product in the bundle is conditioned on the purchase of a second product, identical to the first. Notwithstanding this, I conclude that the bundling of two identical products is not usefully analyzed by tying analysis. Doing so adds no useful incremental economic insight as to the anti-competitive effects, if any, of this type of bundling arrangement.

By David S. Sibley¹

I. INTRODUCTION

Elsewhere in this issue, Professor Melanie Williams discusses the fact that there have been tying claims that have centered on the bundling of two products that are, arguably, identical. Judicial reactions to such claims have been inconsistent. In Paul v. Pulitzer and Metromedia v. MGM/UA, courts ruled that the products in question were identical and bundling them was not an illegal tie.

In EpiPen, however, the court was open to a different view² in a motion to dismiss. EpiPen is a class action case filed against Mylan, the exclusive distributor of the EpiPen, the most widely used Epinephrine auto-injector device (“EAI”). Although EpiPens had been sold one at a time since