October 20, 2020

Volume X, Number 294

October 19, 2020

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The Other Shoe Drops: Ringleader of Oncology Treatment Market Allocation Scheme Indicted in Florida District Court

Earlier this year, Mintz covered the U.S. Department of Justice’s announcement of a deferred prosecution agreement resolving criminal charges against Florida Cancer Specialists & Research Institute LLC (“FCS”) in a 17-year market allocation scheme. As part of that deferred prosecution agreement, FCS agreed to pay the statutory maximum monetary criminal penalty of $100 million. That penalty, however, and the deferred prosecution agreement itself, related only to the corporate entity itself, not to the individuals who actively engaged in the conspiracy. 

Today, the DOJ announced a grand jury indictment against Dr. William Harwin, founder and former President of FCS. The indictment, much like the Information filed with the FCS deferred prosecution agreement, tells the story of a naked restraint on trade, one that is per se illegal under Section 1 of the Sherman Act. The indictment alleges that Dr. Harwin had an agreement in place with an unidentified “Individual 1” at “Company A” whereby FCS would agree to not provide radiation oncology treatments to patients in Southwest Florida, and in return, Company A would agree to not provide medical oncology treatments to patients in the same region.

In conspiracy cases, there is rarely direct evidence of the charged offense, for example, a written agreement. Instead, the prosecution must rely on indirect evidence such as the monitoring and enforcement of an alleged conspiratorial agreement. Here, the indictment alleges that at multiple times Dr. Harwin sought to monitor and enforce his conspiracy, and memorialized his actions in multiple ways, including:

  • After learning that Oncology Company A was administering the drug Provenge to cancer patients (a form of medical oncology), Dr. Harwin informed Individual 1, “we expect you will end this”;

  • After Oncology Company A’s acquisition of an oncology group that employed oncologists, Dr. Harwin instructed Individual 1 to “Make then[sic] disappear.”; and

  • Specifically noting in correspondence that “I told [Individual 1] that there is no way I will be ok with [Oncology Company A] hiring med oncs, ours or others. Period.”

In the DOJ’s press release, Assistant Attorney General Makan Delrahim noted, “As the charge demonstrates, the division remains committed to holding culpable executives accountable for their crimes, especially when they impact vulnerable Americans, such as those in need of life saving treatments.” 

The indictment serves as a stark reminder that that this type of behavior—market allocation—is a crime.  Health care companies should not be deterred, however, from pro-competitive competitor collaborations, especially during the COVID-19 crises when many providers are facing supply and equipment shortages. Although most such collaborations raise no serious antitrust issues you should still make sure your company is aware of the risks and has a robust compliance program in place to train your executives. After all, as illustrated here, executives are not shielded by corporate formalities, and market allocation and other conspiratorial behavior carries criminal liability not only for the corporation, but also for executives themselves.

©1994-2020 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. All Rights Reserved.National Law Review, Volume X, Number 268


About this Author

Bruce Sokler, Mintz Levin Law Firm, Washington DC, Health Care, Antitrust and Litigation Attorney

Bruce is Chair of the Antitrust Section and in his over 30 years in private practice, he has developed extensive experience in both antitrust and communications regulation, including associated First Amendment and copyright law matters

In the antitrust area, Bruce’s practice includes antitrust counseling and representation in connection with federal and state governmental matters, as well as private antitrust litigation. He counsels and has represented Fortune 100 companies, not-for-profits, start-up entities, and domestic and international joint ventures. Bruce has been involved in...

Joseph M. Miller Antitrust Attorney Mintz, Levin, Cohn, Ferris, Glovsky & Popeo

Joe is a seasoned antitrust attorney and Co-chair of the firm’s Antitrust Practice. He has nearly 30 years of experience that spans roles in private practice, as a general counsel, and with federal antitrust enforcement agencies. He focuses his practice on providing strategic transactional advice and representing clients in government investigations and merger reviews. Joe primarily works with clients in the health care industry.

His work includes representing health care companies before the FTC and DOJ in merger reviews, counseling them on the antitrust aspects of transactions, and advising on risks associated with payer-provider contracting. He also advises pharmaceutical distributors, hospitals, health plans, and physician groups on a broad range of compliance issues, including information sharing, contractual arrangements, and interactions with competitors.

Prior to joining Mintz, Joe was a partner at a Washington, DC-based international law firm, where he was on the steering committee of the firm’s Antitrust Group as well as a member of the firm’s Health Care Group.

Before returning to private practice, Joe was the general counsel of a national trade association for the health insurance industry. Along with supervising a team of attorneys, he served as the association’s policy lead on health care competition issues, regularly testifying before Congress, advocating for positions at FTC policy roundtables, and participating in health care symposia.

Earlier in his career, Joe served as Assistant Chief of the Health Care and Consumer Products Section of the US Department of Justice’s Antitrust Division, a lead attorney on DOJ antitrust investigations in multiple industries, and a trial attorney in the Federal Trade Commission's Bureau of Competition.

Joe is a sought-after speaker at trade association events, including the American Health Lawyers Association (AHLA) and America’s Health Insurance Plans (AHIP), as well as at the American Conference Institute, American Bar Association Antitrust Law Section, government agencies, and private organizations. He is also frequently quoted in national legal and business publications, including Bloomberg periodicals, Corporate Counsel, Global Competition Review, and Law360.

Shawn Skolky, Mintz Levin Law Firm, Washington DC, Corporate and Litigation Law Attorney

Shawn advises on many aspects of antitrust and competition law, including antitrust counseling, merger review, and private antitrust litigation, including class actions. His consumer product safety practice focuses on helping companies seeking representation on product safety reporting obligations, recalls, regulatory compliance, product safety investigations, and enforcement matters involving the Consumer Product Safety Act (CPSA) and other federal and state product safety laws.