Antitrust
The enforcement action being studied is that of Novartis AG. The case involves the proposed acquisition by Novartis of Alcon Inc., which is a subsidiary of Nestle. The industry in question is the injectable miotics, which is a $12.4 million market. Injectable miotics are a class of prescription pharmaceuticals. These two companies are the only two in the industry, with respective market shares of 67% and 33%. Post-merger, Novartis would have a 100% share of this industry in the United States.
The specific antitrust act that is relevant to this investigation is the Clayton Act, Section 7 and Section 5 of the Federal Trade Commission Act. If the merger went through, Novartis would have a monopoly in the injectable miotics industry. Firms with monopoly power have no market incentive to constrain their prices. The risk to consumers of this deal is that Novartis would have complete pricing power in this category. Not only is it likely that Novartis would discontinue...
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