[Federal Register Volume 74, Number 23 (Thursday, February 5, 2009)]
[Notices]
[Pages 6155-6157]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-2376]


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FEDERAL TRADE COMMISSION

[File No. 091 0000]


Getinge AB and Datascope Corp.; Analysis of Agreement Containing 
Consent Order to Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed Consent Agreement.

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SUMMARY: The consent agreement in this matter settles alleged 
violations of federal law prohibiting unfair or deceptive acts or 
practices or unfair methods of competition. The attached Analysis to 
Aid Public Comment describes both the allegations in the draft 
complaint and the terms of the consent order--embodied in the consent 
agreement--that would settle these allegations.

DATES: Comments must be received on or before March 2, 2009.

ADDRESSES: Interested parties are invited to submit written comments. 
Comments should refer to ``Getinge Datascope, File No. 091 0000,'' to 
facilitate the organization of comments. A comment filed in paper form 
should

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include this reference both in the text and on the envelope, and should 
be mailed or delivered to the following address: Federal Trade 
Commission/Office of the Secretary, Room 135-H, 600 Pennsylvania 
Avenue, N.W., Washington, D.C. 20580. Comments containing confidential 
material must be filed in paper form, must be clearly labeled 
``Confidential,'' and must comply with Commission Rule 4.9(c). 16 CFR 
4.9(c) (2005).\1\ The FTC is requesting that any comment filed in paper 
form be sent by courier or overnight service, if possible, because U.S. 
postal mail in the Washington area and at the Commission is subject to 
delay due to heightened security precautions. Comments that do not 
contain any nonpublic information may instead be filed in electronic 
form by following the instructions on the web-based form at (http://secure.commentworks.com/ftc-GetingeDatascope). To ensure that the 
Commission considers an electronic comment, you must file it on that 
web-based form.
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    \1\ The comment must be accompanied by an explicit request for 
confidential treatment, including the factual and legal basis for 
the request, and must identify the specific portions of the comment 
to be withheld from the public record. The request will be granted 
or denied by the Commission's General Counsel, consistent with 
applicable law and the public interest. See Commission Rule 4.9(c), 
16 CFR 4.9(c).
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    The FTC Act and other laws the Commission administers permit the 
collection of public comments to consider and use in this proceeding as 
appropriate. All timely and responsive public comments, whether filed 
in paper or electronic form, will be considered by the Commission, and 
will be available to the public on the FTC website, to the extent 
practicable, at www.ftc.gov. As a matter of discretion, the FTC makes 
every effort to remove home contact information for individuals from 
the public comments it receives before placing those comments on the 
FTC website. More information, including routine uses permitted by the 
Privacy Act, may be found in the FTC's privacy policy, at (http://www.ftc.gov/ftc/privacy.shtm).

FOR FURTHER INFORMATION CONTACT: David L. Inglefield, Bureau of 
Competition, 600 Pennsylvania Avenue, NW, Washington, D.C. 20580, (202) 
326-2637.

SUPPLEMENTARY INFORMATION: Pursuant to section 6(f) of the Federal 
Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46(f), and Sec.  2.34 of 
the Commission Rules of Practice, 16 CFR 2.34, notice is hereby given 
that the above-captioned consent agreement containing a consent order 
to cease and desist, having been filed with and accepted, subject to 
final approval, by the Commission, has been placed on the public record 
for a period of thirty (30) days. The following Analysis to Aid Public 
Comment describes the terms of the consent agreement, and the 
allegations in the complaint. An electronic copy of the full text of 
the consent agreement package can be obtained from the FTC Home Page 
(for January 29, 2009), on the World Wide Web, at (http://www.ftc.gov/os/2009/01/index.htm). A paper copy can be obtained from the FTC Public 
Reference Room, Room 130-H, 600 Pennsylvania Avenue, NW, Washington, 
D.C. 20580, either in person or by calling (202) 326-2222.
    Public comments are invited, and may be filed with the Commission 
in either paper or electronic form. All comments should be filed as 
prescribed in the ADDRESSES section above, and must be received on or 
before the date specified in the DATES section.

Analysis of Agreement Containing Consent Order to Aid Public Comment

I. Introduction

    The Federal Trade Commission (``Commission'') has accepted, subject 
to final approval, an Agreement Containing Consent Order (``Consent 
Agreement'') from Getinge AB (``Getinge'') and Datascope Corp. 
(``Datascope''). The purpose of the proposed Consent Agreement is to 
remedy the anticompetitive effects that would otherwise result from 
Getinge's acquisition of Datascope. Under the terms of the proposed 
Consent Agreement, Datascope is required to divestto a third party its 
endoscopic vessel harvesting (``EVH'') product line.
    The proposed Consent Agreement has been placed on the public record 
for thirty days to solicit comments from interested persons. Comments 
received during this period will become part of the public record. 
After thirty days, the Commission will again review the proposed 
Consent Agreement and the comments received, and will decide whether it 
should withdraw from the proposed Consent Agreement or make it final.
    Pursuant to an Agreement and Plan of Merger dated September 15, 
2008, Getinge proposes to acquire all of the outstanding shares of 
Datascope common stock in a transaction valued at approximately $865 
million. The Commission's complaint alleges that the proposed 
acquisition, if consummated, would violate Section 7 of the Clayton 
Act, as amended, 15 U.S.C. Sec.  18, and Section 5 of the Federal Trade 
Commission Act, as amended, 15 U.S.C. Sec.  45, by lessening 
competition in the U.S. market for EVH devices. The proposed Consent 
Agreement would remedy the alleged violations by replacing the 
competition that would be lost in this market as a result of the 
acquisition.

II. The Parties

    Getinge is a leading global provider of equipment and systems in 
the healthcare and life sciences fields. Getinge is divided into three 
business segments: Medical Systems, Extended Care, and Infection 
Control. The Medical Systems segment manufactures and sells, among 
other things, surgical tables and lights. In January 2008, Getinge 
acquired the Cardiac and Vascular divisions of Boston Scientific 
Corporation, including Guidant's EVH business, which Boston Scientific 
had purchased in 2006. The Boston Scientific divisions have been 
integrated into the Medical Systems segment of Getinge, and the 
products are now sold under the Maquet brand. In 2007, Getinge 
generated global sales of $2.2 billion.
    Datascope is the world's leading supplier of intra-aortic balloon 
pump counter pulsation devices, and is a diversified medical device 
company that develops, manufactures and sells proprietary products for 
clinical health care markets in interventional cardiology, 
cardiovascular and vascular surgery, and critical care. Datascope 
acquired the EVH devices at issue in this case from Ethicon, a Johnson 
& Johnson company, in January 2006. Datascope's global sales for fiscal 
year 2008 were $230.9 million, and its U.S. sales were $98.8 million. 
Datascopic's EVH device is part of its Cardiac Assist business unit, 
which accounted for $189.3 million of Datascope's worldwide sales.

III. Endoscopic Vessel Harvesting Devices

    The EVH device market is the relevant product market in which to 
analyze the competitive effects of the proposed acquisition. EVH 
devices are used in coronary artery bypass graft (``CABG'') surgery, 
most often to remove the saphenous vein from the patient's leg, or 
sometimes the radial artery from the arm, for use as a conduit to 
bypass one or more blocked coronary arteries. Because it is a 
minimally-invasive procedure, EVH provides several benefits over the 
other two vessel harvesting methods (open and bridging) both of which 
are more invasive, cause more pain and scarring, and carry a greater 
risk of infection. As a result,

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neither of the other methods is considered a viable economic 
alternative for EVH devices. EVH devices, therefore, constitute a 
separate product market.
    The United States is the relevant geographic market in which to 
analyze the effects of the proposed acquisition on the EVH device 
market. EVH devices are subject to regulation and cannot be marketed or 
sold in the United States without prior approval from the U.S. Food and 
Drug Administration (``FDA''). Receiving FDA approval to market an EVH 
device in the United States can be a lengthy process. EVH devices sold 
outside of the United States but not approved by the FDA for sale in 
the United States therefore do not provide viable competitive 
alternatives for U.S. consumers.
    The U.S. market for EVH devices is highly concentrated, and 
together, the combined firm would account for approximately 90 percent 
of this market. Firms seeking to enter the market for EVH devices face 
regulatory hurdles and significant intellectual property barriers, both 
of which make entry into the market for EVH devices in the next two to 
three years highly unlikely. In addition, while the use of EVH devices 
in CABG surgery is increasing, the number of CABG procedures and 
related vessel harvesting procedures performed in the United States has 
been declining as minimally-invasive stenting procedures have 
increased. As a result, it is unlikely that firms would find it 
profitable to enter the EVH device market in response to a modest 
increase in the price of the devices.
    The proposed acquisition would result in a duopoly in the market 
for EVH devices and is likely to lead to increased prices and decreased 
innovation for those devices.

IV. The Consent Agreement

    The proposed Consent Agreement effectively remedies the proposed 
acquisition's anticompetitive effects in the U.S. market for EVH 
devices by requiring Datascope to divest its EVH product line to a 
Commission-approved buyer at no minimum price. Datascope has reached an 
agreement to divest the EVH business to Sorin Group USA, Inc. Sorin, a 
diversified medical device company, has a line of cardiovascular 
products, including artificial cardiac valves and coronary stents. 
Pursuant to the Consent Agreement, Datascope is required to accomplish 
the divestiture of its EVH product line no later than ten days after 
the acquisition is consummated.
    The divestiture will allow Sorin to enter and compete in the EVH 
market. The assets to be divested include all third party contracts to 
supply the components of the EVH product line. In addition, the Consent 
Agreement requires Getinge to grant the Commission-approved buyer a 
covenant not to sue for infringement of any EVH-related patents that 
Getinge or Datascope held at the time of the acquisition. The Consent 
Agreement also permits Datascope to provide certain transitional 
services to the Commission-approved buyer of the EVH product line 
assets. These services may be necessary to ensure a smooth transition 
of the product line to the acquirer and continued and uninterrupted 
service to customers during the transition. The purchaser will have a 
secure supply of the EVH product line because third parties supply the 
components of the EVH product line. Further, Sorin currently is capable 
of assembling the components and marketing the finished products.

V. Appointment of an Interim Monitor and a Divestiture Trustee

    The proposed Consent Agreement includes a provision that allows the 
Commission to appoint an interim monitor to oversee Datascope's 
compliance with all of its obligations and performance of its 
responsibilities pursuant to the Commission's Decision and Order. If 
appointed, the interim monitor would be required to file periodic 
reports with the Commission to ensure that the Commission remains 
informed about the status of the divestitures, the efforts being made 
to accomplish the divestiture, and the provision of services and 
assistance during the transition period.
    Finally, the proposed Consent Agreement contains provisions that 
allow the Commission to appoint a divestiture trustee if any or all of 
the above remedies are not accomplished within the time frames required 
by the Consent Agreement. The divestiture trustee may be appointed to 
accomplish any and all of the remedies required by the proposed Consent 
Agreement that have not yet been fulfilled upon expiration of the time 
period allotted for each.
    The purpose of this analysis is to facilitate public comment on the 
proposed Consent Agreement, and it is not intended to constitute an 
official interpretation of the proposed Decision and Order or to modify 
its terms in any way. By direction of the Commission.

Donald S. Clark,
Secretary.
[FR Doc. E9-2376 Filed 2-4-09: 8:45 am]
BILLING CODE 6750-01-S