United States: Medical Material Manufacturer Settles FTC Charges Of Using Exclusive Contracts To Impede Competition
Article by Geoffrey Oliver, David P. Wales, H. Kristie Xian and Aimee DeFilippo, Jones Day
The U.S. Federal Trade Commission has made a settlement agreement with Invibio, Inc. (“Invibio”), a British-owned supplier of implant-grade polymer, to resolve allegations that the company used exclusive supply agreements to maintain its monopoly power in the market for high-tech polymer material. In the Matter of Victrex plc, et al.
This is one of several recent matters in which U.S. antitrust enforcers have challenged exclusivity provisions that allegedly prevented a dominant supplier’s customers from purchasing products from rivals. In the government’s view, the challenged provisions impeded competitors from developing into effective rivals, thus reinforcing the dominant supplier’s monopoly position.
Background
Invibio supplies medical device makers with polyethertherketone (“PEEK”), a high-performance polymer used to construct spinal, orthopedic, and other human implants. From the time that Invibio first began supplying implant-grade PEEK, it entered into long-term supply contracts with its customers. Many of those contracts included exclusivity terms requiring medical device makers to use only Invibio’s PEEK for their implantable devices, and restricting medical device makers’ ability to switch to an alternative PEEK supplier even after the contract expired.
