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DOJ and FTC Announce Draft Vertical Merger Guidelines

On January 10, 2020, The Department of Justice (DOJ) and Federal Trade Commission (FTC) announced new draft vertical merger guidelines for public comment. The draft guidelines (once finalized) will replace the DOJ’s 1984 Non-Horizontal Merger Guidelines and describe how the FTC and DOJ will analyze and enforce vertical mergers for compliance with the antitrust laws. Vertical mergers combine two or more companies operating at different levels of the same supply chain, e.g., a combination between a hospital and independent physician group, or a health system and a skilled nursing facility. The draft guidelines adopt common concepts from the Horizontal Merger Guidelines, such as the definition of a “market,” the framework for analyzing the sale of a failing business or its assets and the purchase of partial ownership interests. Notably, and to the disappointment of many within the health care community, the draft guidelines provide little guidance on vertical mergers specific to the health care industry. Additionally, two FTC Commissioners abstained from voting on the draft guidelines and issued statements outlining their concerns that the guidelines are too lenient toward vertical mergers.

The DOJ and FTC are accepting comments for 30 days on the draft guidelines until February 11, 2020. Comments on the draft guidelines can be emailed to verticalmergerguidelines@ftc.gov and verticalmergerguidelines@usdoj.gov.

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About this Author

Nathaniel Arden, Health Care and Intellectual Property Attorney, Robinson Cole Law Firm, Hartford, Connecticut
Associate

Nathaniel Arden is a member of Robinson+Cole’s Health Law Group. He advises hospitals, health systems, physician groups, community providers, and other health care entities on a variety of health law and business issues. His practice focuses on health care-related regulatory and transactional matters, as well as health care-related information technology issues. Nathaniel has an extensive background in the healthcare industry, and he worked at a large academic medical center prior to joining the firm.

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