Risk & Compliance

Surescripts Sued Over Anti-Competitive Practices

The FTC is charging the company with illegal monopolization of the e-prescription market.
Lauren MuskettApril 25, 2019

The Federal Trade Commission filed an antitrust lawsuit against the health information network Surescripts, accusing the company of using illegal vertical and horizontal restraints to maintain monopolies over electronic prescribing markets.

In a lawsuit filed April 17 in the U.S. District Court for the District of Columbia, the FTC accused Surescripts of illegally pressuring a corporate customer to prevent it from moving its business to a rival. The suit alleges Surescripts required long-term exclusivity and punished customers with high prices. The FTC said Surescripts tactics allowed it to maintain monopolies in routing and eligibility markets, even as the number of transactions grew from 70 million routing transactions in 2008 to more than 1.7 billion in 2017.

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“For the past decade, Surescripts has used a series of anticompetitive contracts throughout the e-prescribing industry to eliminate competition and keep out competitors,” Bruce Hoffman, head of the FTC’s Bureau of Competition, said in a statement.

“Surescripts’ illegal contracts denied customers and, ultimately, patients, the benefits of competition — including lower prices, increased output, thriving innovation, higher quality, and more customer choice,” Hoffman said.

In a statement, Surescripts CEO Tom Skelton said the company has cut the cost of electronic prescribing by 70% since 2009 and processes more than 5 million e-prescriptions per day.

“We are making an important change to our e-prescribing business agreements with pharmacies by removing the loyalty provisions in those contracts. This step addresses one of the FTC’s chief concerns while reflecting the current dynamics of the healthcare industry and the state of electronic prescribing today,” he said.

Skelton said the company was “very disappointed at the allegations.”

The FTC vote to file the complaint was 5-0.

The commission reached settlements in recent months with Teva Pharmaceuticals and Impax Laboratories over the use of reverse-payment patent settlement agreements that block consumers’ from buying lower-priced generic drugs.