The Federal Trade Commission (FTC) faces challenges in monitoring smaller mergers and acquisitions due to the current dollar threshold for notification, according to FTC Chair Lina Khan. In a fireside chat at the Oliver Wyman Health Innovation Summit in Chicago, Khan highlighted the potential blind spots that arise when deals below the radar incrementally consolidate a market, leading to domination by a few players. Khan expressed concerns about missing out on these deals, which can have significant implications in certain markets like dialysis and medical devices.
To address these issues, the FTC proposed changes to the Hart-Scott-Rodino Form (HSR Form), the premerger notification form. The proposed changes would require companies to provide details about the rationale for the deal, projected revenue streams, and previous acquisitions, including those that were below the radar. Khan emphasized the agency’s efforts to eliminate blind spots and understand the extent of deals that evade their notification threshold, citing a past FTC report that revealed 800 deals by top tech companies that went unnoticed.
Aside from monitoring smaller deals, Khan discussed other areas of focus for the FTC. One priority is investigating the practices of pharmacy benefit managers (PBMs), as complaints have arisen about practices between PBMs and drug manufacturers that may affect access to medicines for patients and squeeze pharmacies. The FTC has also proposed a rule to eliminate non-compete clauses in employment contracts, with a particular interest in the healthcare industry.
Consumer protection is another area of concern for the FTC, particularly regarding data privacy. Khan highlighted the agency’s efforts to ensure that health apps collecting sensitive personal data for the provision of health services do not exploit that data for advertising purposes. The FTC has taken enforcement actions to protect privacy and prevent the monetization of health data without consent.
The FTC’s challenges in monitoring smaller mergers and acquisitions and their broader focus on healthcare practices and consumer protection reflect the agency’s commitment to maintaining fair competition and safeguarding the interests of consumers in an evolving marketplace.
FTC.gov – Federal Trade Commission
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