November 25, 2019
Joel Mitnick comments on the Federal Trade Commission’s approval of Bristol-Myers Squibb’s $74 billion acquisition of Celgene and what the 3-2 party-line vote signals.
An excerpt from "Bristol-Myers’ Buyout of Celgene Approved by Deeply Divided FTC," FTCWatch, November 25, 2019:
“This is not a typical majority-minority split where there’s a disagreement over the facts or applying the facts to the law,” Joel Mitnick of Cadwalader Wickersham & Taft said in an interview. “This is a much more fundamental rift.”
“You have three commissioners — the Chairman [Joe Simons] and Commissioner Phillips and Commissioner [Christine] Wilson — who are following the traditional application of antitrust law to mergers,” Mitnick said. “They are making an evidentiary-based analysis as to whether the specific merger before them is likely to substantially lessen competition in a line of business.”
“That is what the statute tells us to look at,” he added. “They are coming to the conclusion that with the negotiated relief, there is no basis to fear a lessening of competition and therefore, they say, the merger should be allowed.”
By contrast, Commissioners Chopra and Slaughter “want to be disruptors, just in the way young tech businesses are disruptors of traditional markets. These two young commissioners want to be disruptors of traditional analysis.”
“They are saying when we look at healthcare markets, we don’t think they are serving the American public. We don’t think they are particularly competitive anymore, and therefore we need to have an entire paradigmatic shift to a new analysis,” noted Mitnick, who began his career as an FTC trial lawyer.
“I don’t think you can fault them for taking that policy position,” he said. “What you can rightly fault them for is that if they are going to throw out the traditional analytical framework, they are intellectually obligated to offer a different analytical framework.”