Democrats on the House antitrust subcommittee want to know why the Federal Trade Commission fast-tracked the merger of two medical device manufacturers they say may be responsible for the current ventilator shortage, a deal that had “all the hallmarks of a killer acquisition.”
According to Law 360, the demand comes in response to reports that shortly after medical device manufacturer Covidien was given the go-ahead in 2012 to buy out rival ventilator maker Newport Medical Instruments, it dropped a contract that Newport Medical had to make the life-saving machines for the government’s stockpile.
“As a nation, we find ourselves experiencing a massive and unnecessary shortage of essential medical devices like ventilators. We owe it to all of the affected patients and medical professionals to understand whether this merger was indeed a ‘killer’ acquisition that is partly to blame for the current scarcity of ventilators during a viral pandemic,” the lawmakers wrote in their Friday, April 10, letter.
“Killer acquisitions” occur when a dominant market player buys up a burgeoning rival to fend off future competition. The missive was signed by all eight Democrats on the US House of Representatives’ Subcommittee on Antitrust, Commercial and Administrative Law and by House Judiciary Committee Chairman Jerry Nadler of New York. The letter requested copies of all the agency’s documents from their investigation into the merger.
The day the lawmakers sent their letter, the number of confirmed US cases of COVID-19, the disease caused by the novel coronavirus, was poised to reach 500,000, and more than 18,000 people have already died from the disease across the country.
Full Content: Law 360, Jerry Nadler
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