58840 Federal Register / Vol. 77, No. 185 / Monday, September 24, 2012 / Notices 

1American Pet Products Association Industry 

Statistics & Trends. 

2Packaged Facts estimates. 

3The size of the overall U.S. pet industry grew 

steadily from $17 billion in 1994 to over $50 billion 

in 2011. (American Pet Products Association 

Industry Statistics & Trends.) The size of the U.S. 

pet medications market grew from approximately 

$4.5 billion in 2006 to approximately $6.7 billion 

in 2011, and is projected to reach $9.25 billion by 

2015. (Packaged Facts estimates.) 

4 Id. Of the estimated $6.7 billion in U.S. retail 

sales of pet medications in 2011, 36% was for flea 

and tick control products, and 19% was for 

heartworm preventatives. (Packaged Facts 

estimates.) 

or its agents, personally view, inspect, 

or monitor assisted living facilities, 

including representations that it 

personally views, inspects, or monitors 

any particular number, portion, or 

percentage of ALFs in a geographic 

region. 

Part I.B prohibits ABC from making 

any false or unsubstantiated 

representations regarding its placement 

services. 

Parts II through V require ABC to: 

Keep copies of advertisements and 

materials relied upon in disseminating 

any representation covered by the order; 

provide copies of the order to certain 

personnel, agents, and representatives 

having supervisory responsibilities with 

respect to the subject matter of the 

order; notify the Commission of changes 

in its structure that might affect 

compliance obligations under the order; 

and file a compliance report with the 

Commission and respond to other 

requests from FTC staff. Part VI provides 

that the order will terminate after 

twenty (20) years, with certain 

exceptions. 

The purpose of this analysis is to 

facilitate public comment on the 

proposed order. It is not intended to 

constitute an official interpretation of 

the complaint or the proposed order, or 

to modify the proposed order’s terms in 

any way. 

By direction of the Commission. 

Donald S. Clark, 

Secretary. 

[FR Doc. 2012–23413 Filed 9–21–12; 8:45 am] 

BILLING CODE 6750–01–P 

FEDERAL TRADE COMMISSION 

Request for Comments and 

Announcement of Workshop on Pet 

Medications Issues 

AGENCY: Federal Trade Commission 

(‘‘FTC’’ or ‘‘Commission’’) 

ACTION: Reopening of the comment 

period for submission of public 

comments. 

SUMMARY: The FTC is reopening the 

period for filing public comments in 

connection with a workshop to examine 

competition and consumer protection 

issues in the pet medications industry. 

The workshop will consider how 

current industry distribution and other 

business practices affect consumer 

choice and price competition for pet 

medications; the ability of consumers to 

obtain written, portable prescriptions 

that they can fill wherever they choose; 

and the ability of consumers to verify 

the safety and efficacy of pet 

medications that they purchase. The 

workshop will also examine the extent 

to which recent changes to restricted 

distribution and prescription portability 

practices in the contact lens industry 

might yield lessons applicable to the pet 

medications industry. The Commission 

seeks the views of consumers, 

veterinarians, business representatives, 

economists, lawyers, academics, and 

other interested parties on these issues. 

This notice poses a series of questions 

relevant to those issues about which the 

Commission seeks comment. After 

conducting the workshop and reviewing 

comments, the Commission may 

prepare a report discussing these issues. 

DATES: The FTC is reopening the 

comment period and extending the 

deadline for filing public comments 

until November 1, 2012. 

ADDRESSES: Interested parties are 

invited to submit written comments 

electronically or in paper form by 

following the instructions in the 

SUPPLEMENTARY INFORMATION section 

below. Comments in electronic form 

should be submitted by using the 

following Web link: https:// 

ftcpublic.commentworks.com/ftc/ 

petmedsworkshop (and following the 

instructions on the Web-based form). 

Comments filed in paper form should be 

mailed or delivered to the following 

address: Federal Trade Commission, 

Office of the Secretary, Room H–113 

(Annex X), 600 Pennsylvania Avenue 

NW., Washington, DC 20580, in the 

manner detailed in the SUPPLEMENTARY

INFORMATION section below. 

FOR FURTHER INFORMATION CONTACT: 

Stephanie A. Wilkinson, Attorney, 

Office of Policy Planning, Federal Trade 

Commission, 600 Pennsylvania Avenue 

NW., Washington, DC 20580, 202–326– 

2084, petmedsworkshop@ftc.gov. 

SUPPLEMENTARY INFORMATION: The 

quality and cost of pet medications is an 

important pocketbook issue for many 

consumers. In 2011, 62 percent of U.S. 

households owned a pet, and Americans 

spent an estimated $50 billion on their 

pets,1 including nearly $7 billion for 

prescription and over-the-counter (OTC) 

pet medications.2 Drawing on the 

Federal Trade Commission’s expertise 

as a competition and consumer 

protection agency, the workshop will 

examine ways to inform and empower 

consumers to obtain the highest quality 

and most cost-effective healthcare 

products for their pets. 

Pet owners spend significantly more 

money on their pets than in past 

decades, and the market for pet 

medications has grown significantly in 

recent years.3 Manufacturers and 

veterinarians have introduced new and 

improved diagnostic and therapeutic 

treatments for pets; pet medications 

have become available at some online 

and brick-and-mortar retail outlets; and 

veterinarians and others have 

increasingly emphasized preventative 

pet care. In addition, market 

participants note, in recent years it has 

become easier to administer flea and 

tick control products and heartworm 

preventatives, and the products 

themselves have become more effective. 

These products comprise the bulk of 

chronic pet medications sold in the 

United States. Indeed, the sale of 

prescription and OTC flea, tick, and 

heartworm products totaled nearly $3.7 

billion in 2011.4

Distribution Practices in the Pet 

Medications Industry 

Historically, veterinarians have been 

the principal dispensers of pet 

medications because of their unique role 

in the veterinarian-client-patient 

relationship, whereby a veterinarian 

examines, diagnoses, and treats the 

animal (patient), while also providing 

information to the animal’s owner 

(client). Consumers still purchase most 

of their pet medications from the 

veterinarians who examine their pets, 

and most pet medication manufacturers 

choose to distribute their products 

exclusively through the veterinary 

channel. 

Nonetheless, pet medications are no 

longer sold exclusively by veterinarians. 

Over the last ten years, brick-and-mortar 

and online retail and pharmacy entities 

(hereinafter collectively referred to as 

‘‘retailers’’) also have begun selling pet 

medications, especially OTC 

medications. Some evidence suggests 

that these retailers may offer substantial 

pro-consumer benefits, such as 

increased convenience and lower prices. 

Although retailers may obtain some 

portion of their pet medication products 

directly from manufacturers or 

authorized distributors, they also rely 

heavily on secondary supply channels. 

Most manufacturers state that they 

restrict the distribution of their pet 


TKELLEY on DSK3SPTVN1PROD with NOTICES
Federal Register / Vol. 77, No. 185 / Monday, September 24, 2012 / Notices 58841 

5 It should be noted that the term ‘‘diversion’’ as 

used in human pharmaceutical markets means the 

illegal trade in prescription narcotics, in which 

products are not being used by the consumer in the 

manner intended. This is distinct from the situation 

in the pet medications market, in which products 

obtained through secondary supply channels are 

being used by the consumer in the manner 

intended. 

6See Principles of Veterinary Medical Ethics of 

the AVMA, III.C.1. 

7See Fairness to Pet Owners Act, H.R. 1406, 

112th Cong. (2011), available at http:// 

www.gpo.gov/fdsys/pkg/BILLS-112hr1406ih/pdf/ 

BILLS-112hr1406ih.pdf. 

medications to the veterinary channel, 

and that they use well-established 

tracking procedures to ensure the safety 

and efficacy of their products. Certain 

veterinarians purchase pet medications 

from manufacturers or authorized 

distributors and then resell some 

portion of their purchase to secondary 

suppliers for a profit, a practice 

sometimes referred to as ‘‘diversion.’’ 5

Some secondary suppliers and retailers 

claim to have protocols in place to 

verify that the retailers receive bona fide 

products that originated with the 

manufacturer. Other industry 

participants, however, have questioned 

whether secondary suppliers and 

retailers always receive bona fide 

products (as compared to, for example, 

counterfeit product from non-U.S. 

sources), thereby raising potential 

questions about product safety and 

authenticity. The workshop will 

examine how competition in sales of pet 

medications to consumers has 

developed in light of these practices and 

how prices, product supply, and 

product quality may be affected. 

In the workshop, the Commission 

seeks to examine issues related to the 

distribution of pet medications from 

practical, economic, and legal 

perspectives. The Commission invites 

public comment on questions relevant 

to this topic, including: 

• How are pet medications 

distributed to consumers? 

• What are the business rationales for 

various pet medication distribution 

practices? 

• How has competition to sell 

medications to pet owners evolved in 

light of these distribution practices? 

• How do these practices affect prices 

to consumers? 

• How do these practices affect 

product supply and quality? 

• How do these practices affect 

consumer choice? 

• How do these practices affect entry 

into the pet medications market? 

• How do these practices affect 

innovation in the pet medications 

market? 

• What efficiencies or inefficiencies 

are associated with these practices? 

• What, if any, product safety or 

counterfeiting issues exist with respect 

to these practices? Have there been 

instances in which false or misleading 

information about product safety risks 

was disseminated to consumers? 

• Are there other factors that should 

be considered when analyzing the 

competition and consumer protection 

issues related to the distribution of pet 

medications? 

Prescription Portability for Pet 

Medications 

All industry participants agree that 

pets should be properly examined and 

diagnosed by a veterinarian to 

determine the most appropriate course 

of treatment for any medical condition, 

including whether any medication 

should be prescribed. When a 

veterinarian writes a prescription for a 

medication to be dispensed and 

subsequently administered by a pet’s 

owner, the prescription must be filled 

with the correct medication and dosage 

and the owner must have access to 

relevant information about the 

medication and proper administration 

techniques. Some observers argue that 

veterinarians are in the best position to 

carry out these responsibilities; these 

observers believe, therefore, that 

veterinarians alone should dispense 

prescription pet medications to their 

clients. Others argue that licensed 

pharmacists are equally capable of 

dispensing pet medications to 

consumers, provided the pharmacists 

dispense the correct medication and 

dosage as prescribed by a veterinarian; 

these advocates point out that 

veterinarians can still provide relevant 

information and follow-up care to their 

clients even if they do not dispense the 

medication. Concerns about the safety of 

pet medications dispensed by 

pharmacists appear less pronounced for 

OTC medications, which do not require 

a prescription and typically do not 

require direct supervision by a 

veterinarian. 

A consumer cannot legally obtain 

prescription pet medications from a 

retailer without a written, portable 

prescription from a veterinarian. The 

American Veterinary Medical 

Association (AVMA) advises 

veterinarians to honor a client’s request 

for a prescription, provided that a valid 

veterinarian-client-patient relationship 

exists.6 This guidance is not mandatory, 

however. State regulations vary as to 

whether veterinarians are legally 

required to provide written 

prescriptions to clients, and it is unclear 

to what extent such regulatory 

obligations may be actively enforced 

against veterinarians. It appears that, 

while many veterinarians provide 

written prescriptions to their clients 

when requested, some veterinarians 

have refused to provide prescriptions or 

otherwise have discouraged their clients 

from obtaining pet medications from 

retailers. 

Federal legislation proposed in House 

Bill 1406 (‘‘H.R. 1406’’ or ‘‘the Bill’’) 

would require veterinarians to provide 

clients with written prescriptions for all 

pet medications, regardless of whether 

requested, and to inform clients of their 

right to have pet medications dispensed 

elsewhere.7 The Bill also would prohibit 

veterinarians from charging a fee or 

requiring waivers of liability for 

providing written prescriptions. H.R. 

1406 would require the Federal Trade 

Commission to promulgate rules 

implementing the statute within 180 

days of its enactment. 

In the workshop, the Commission 

seeks to examine issues related to the 

portability of pet medication 

prescriptions from practical, economic, 

and legal perspectives. The Commission 

invites public comment on questions 

relevant to this topic, including: 

• How varied are current veterinarian 

practices with respect to providing 

written, portable prescriptions to 

clients? 

• To what extent are consumers 

aware that they can request a portable 

prescription from their veterinarian and 

have the prescription dispensed 

elsewhere? 

• Which states require prescription 

portability for pet medications? Which 

do not? Are there states in which a 

proposal for prescription portability for 

pet medications was rejected by the 

legislature and, if so, why? 

• In states that do require 

prescription portability, what recourse 

do consumers have if a veterinarian 

refuses to provide a written, portable 

prescription? 

• What evidence exists to support a 

need for federal legislation requiring 

veterinarians to provide written 

prescriptions to their clients? 

• What price and non-price benefits 

can accrue to consumers from 

prescription portability for pet 

medications? 

• What risks or inefficiencies may be 

posed by prescription portability for pet 

medications? 

• Is there a need for federal 

legislation requiring veterinarians to 

notify clients that they have the right to 

fill their prescriptions at the pharmacy 

of their choice? 


TKELLEY on DSK3SPTVN1PROD with NOTICES
58842 Federal Register / Vol. 77, No. 185 / Monday, September 24, 2012 / Notices 

8The 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 FTC 

Rule 4.9(c), 16 CFR 4.9(c). 

• Is it appropriate to deny 

veterinarians the ability to charge a fee 

or require a waiver of liability for 

providing a written prescription to 

clients? 

• How might the passage of H.R. 1406 

affect price, consumer choice, and other 

forms of competition in the pet 

medications market? 

• How can the prices charged to 

consumers for pet medications by 

veterinary clinics and retailers best be 

quantified and compared? 

• To what extent do retailer prices for 

pet medications affect the prices of 

medications sold at veterinary practices, 

or other aspects of veterinary clinic 

operations? 

• To what extent would H.R. 1406 

affect veterinarians’ sales of pet 

medications? 

• What compliance costs would 

veterinarians face if H.R. 1406 were 

enacted? 

• How might the passage of H.R. 1406 

affect pet medication distribution 

practices? 

• Should possible amendments to 

H.R. 1406 be considered? 

• Are there other factors that should 

be considered when analyzing the 

competition and consumer protection 

issues related to the portability of pet 

medication prescriptions? 

Comparison to Fairness to Contact Lens 

Consumers Act 

Some restricted distribution and 

prescription portability issues existed in 

the contact lens industry at the time that 

Congress passed the Fairness to Contact 

Lens Consumers Act (‘‘FCLCA’’), Public 

Law 108–164. Industry participants 

have noted both similarities and 

differences between the contact lens 

industry and the pet medications 

industry. The workshop will examine 

whether consumer experiences with the 

FCLCA might provide insights about the 

potential impact of H.R. 1406. The 

Commission invites public comment on 

questions relevant to this topic, 

including: 

• What was the impact of the FCLCA, 

if any, to consumers? 

• What was the impact of the FCLCA, 

if any, to optometrists and 

ophthalmologists? 

• What was the impact of the FCLCA, 

if any, on entry into the contact lens 

industry? 

• What was the impact of the FCLCA, 

if any, on innovation in the contact lens 

industry? 

• What was the impact of the FCLCA, 

if any, to contact lens distribution 

practices? 

• Are there significant similarities or 

differences between the contact lens 

industry and the pet medications 

industry, particularly with respect to 

industry distribution practices and 

issues of prescription portability? If so, 

how should those similarities or 

differences be taken into account in 

assessing the likely effects of H.R. 1406 

compared to the FCLCA? 

• Are there other factors that should 

be considered when analyzing the 

competition and consumer protection 

issues related to the FCLCA, and how 

consumer experiences with the FCLCA 

might provide insights about the 

potential impact of H.R. 1406? 

Instructions for Filing Public Comments 

Interested parties are invited to 

submit written comments electronically 

or in paper form. The deadline for 

receiving comments has been extended 

to November 1, 2012. Because paper 

mail addressed to the FTC is subject to 

delay due to heightened security 

screening, please consider submitting 

your comments in electronic form. 

Comments filed in electronic form 

should be submitted using the following 

Web link: https:// 

ftcpublic.commentworks.com/ftc/ 

petmedsworkshop (and following the 

instructions on the Web-based form). To 

ensure that the Commission considers 

an electronic comment, you must file it 

on the Web-based form at the Web link: 

https://ftcpublic.commentworks.com/ 

ftc/petmedsworkshop. If this notice 

appears at http://www.regulations.gov/ 

#!home, you may also file an electronic 

comment through that Web site. The 

Commission will consider all comments 

that regulations.gov forwards to it. You 

may also visit the FTC Web site at 

http://www.ftc.gov to read the notice 

and the news release describing it. 

Comments should refer to ‘‘Pet 

Medications Workshop, Project No. 

P12–1201’’ to facilitate the organization 

of comments. Please note that your 

comment—including your name and 

your State—will be placed on the public 

record of this proceeding, including on 

the publicly accessible FTC Web site, at 

http://www.ftc.gov/os/ 

publiccomments.shtm. Because 

comments will be made public, they 

should not include any sensitive 

personal information, such as any 

individual’s Social Security Number; 

date of birth; driver’s license number or 

other State identification number, or 

foreign country equivalent; passport 

number; financial account number; or 

credit or debit card number. Comments 

also should not include any sensitive 

health information, such as medical 

records or other individually 

identifiable health information. In 

addition, comments should not include 

‘‘trade secret or any commercial or 

financial information which is * * * 

privileged or confidential’’ as discussed 

in Section 6(f) of the Federal Trade 

Commission Act (FTC Act), 15 U.S.C. 

46(f), and FTC Rule 4.10(a)(2), 16 CFR 

4.10(a)(2). Comments containing 

material for which confidential 

treatment is requested must be filed in 

paper form, must be clearly labeled 

‘‘Confidential,’’ and must comply with 

FTC Rule 4.9(c).8

A comment filed in paper form 

should include the ‘‘Pet Medications 

Workshop, Project No. P12–1201’’ 

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 H–113 (Annex X), 600 

Pennsylvania Avenue NW., Washington, 

DC 20580. 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. The FTC Act and 

other laws that the Commission 

administers permit the collection of 

public comments to consider and use in 

this proceeding as appropriate. The 

Commission will consider all timely 

and responsive public comments that it 

receives, whether filed in paper or 

electronic form. Comments received 

will be available to the public on the 

FTC Web site, to the extent practicable, 

at http://www.ftc.gov/os/ 

publiccomments.shtm. 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 Web site. 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.htm. 

By direction of the Commission. 

Donald S. Clark 

Secretary. 

[FR Doc. 2012–23464 Filed 9–21–12; 8:45 am] 

BILLING CODE 6750–01–P 


TKELLEY on DSK3SPTVN1PROD with NOTICES