May 9, 2011— The intravenous immunoglobulin (IVIG) manufacturers Grifols and Talecris have signed a consent agreement with the Federal Trade Commission’s (FTC) staff setting the conditions for their proposed merger—a development that 340B covered entities believe will further limit their access to IVIG and the related product albumin at 340B prices.
The two companies made the announcement on May 2. Under the agreement, which must still be voted on by the commission itself, Grifols and Talecris would sell plants and other assets in the United States to the Italian pharmaceutical company Kedrion. The Bloomberg news service reported that Grifols expected the FTC to hand down its final decision by early June.
If the commission gives the merger its blessing, the number of major producers of plasma-derived products will fall to three: Baxter, CSL and Grifols-Talecris. Octapharma withdrew from the IVIG market last fall. There were nine companies in the market in 2003 and 13 in 1990.
Did Staff Change its Position?
As recently as mid-February, the Reuters news service reported that the FTC staff believed that the commission should oppose the merger. Citing an unnamed source, it said the staff was collecting affidavits from hospitals and group purchasing organizations that could be used in a suit seeking to block Grifols’ purchase of its rival.
Two years ago, the FTC filed suit to block CLS from purchasing Talecris, saying the deal would have significantly reduced competition in the U.S. market for IVIG, albumin and other plasma-derived therapies. Members of the 340B provider community had feared that the CSL-Talecris merger would have driven up prices and further limited access to plasma-based products at 340B prices. Sources say the FTC considered that concern in reaching its decision to oppose the sale.
Hospitals enrolled in the 340B program have made similar arguments to the FTC with respect to the new proposed merger. If the commission decides to approve the merger, they say, at a minimum it should insist on provisions in the deal guaranteeing 340B providers continued access to plasma-derived therapies at 340B prices.