Federal Register / Vol. 70, No. 195 / Tuesday, October 11, 2005 / Notices 59069 

1The 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). 

obtained by agencies directly from the 

Applicants. If an agency does not file 

comments within the time specified for 

filing comments, it will be presumed to 

have no comments. One copy of an 

agency’s comments must also be sent to 

the Applicants’ representatives. 

Magalie R. Salas, 

Secretary. 

[FR Doc. E5–5557 Filed 10–7–05; 8:45 am] 

BILLING CODE 6717–01–P 

FEDERAL RESERVE SYSTEM 

Formations of, Acquisitions by, and 

Mergers of Bank Holding Companies 

The companies listed in this notice 

have applied to the Board for approval, 

pursuant to the Bank Holding Company 

Act of 1956 (12 U.S.C. 1841 et seq.) 

(BHC Act), Regulation Y (12 CFR Part 

225), and all other applicable statutes 

and regulations to become a bank 

holding company and/or to acquire the 

assets or the ownership of, control of, or 

the power to vote shares of a bank or 

bank holding company and all of the 

banks and nonbanking companies 

owned by the bank holding company, 

including the companies listed below. 

The applications listed below, as well 

as other related filings required by the 

Board, are available for immediate 

inspection at the Federal Reserve Bank 

indicated. The application also will be 

available for inspection at the offices of 

the Board of Governors. Interested 

persons may express their views in 

writing on the standards enumerated in 

the BHC Act (12 U.S.C. 1842(c)). If the 

proposal also involves the acquisition of 

a nonbanking company, the review also 

includes whether the acquisition of the 

nonbanking company complies with the 

standards in section 4 of the BHC Act 

(12 U.S.C. 1843). Unless otherwise 

noted, nonbanking activities will be 

conducted throughout the United States. 

Additional information on all bank 

holding companies may be obtained 

from the National Information Center 

website at http://www.ffiec.gov/nic/. 

Unless otherwise noted, comments 

regarding each of these applications 

must be received at the Reserve Bank 

indicated or the offices of the Board of 

Governors not later than November 4, 

2005. 

A. Federal Reserve Bank of 

Richmond (A. Linwood Gill, III, Vice 

President) 701 East Byrd Street, 

Richmond, Virginia 23261-4528: 

1. PBSC Financial Corporation, 

Greenville, South Carolina; to become a 

bank holding company by acquiring 100 

percent of the voting shares of Pinnacle 

Bank of South Carolina, Greenville, 

South Carolina (in organization). 

B. Federal Reserve Bank of St. Louis 

(Glenda Wilson, Community Affairs 

Officer) 411 Locust Street, St. Louis, 

Missouri 63166-2034: 

1. Porter Bancorp, Inc., 

Shepherdsville, Kentucky; to acquire 

additional shares, for a total of 100 

percent of the voting shares of BBA, 

Inc., Shepherdsville, Kentucky, and 

thereby indirectly acquire Bullitt 

County Bank, Shepherdsville, Kentucky. 

Board of Governors of the Federal Reserve 

System, October 5, 2005. 

Robert deV. Frierson, 

Deputy Secretary of the Board. 

[FR Doc. E5–5546 Filed 10–7–05; 8:45 am] 

BILLING CODE 6210–01–S 

FEDERAL TRADE COMMISSION 

[File No. 051 0051] 

DaVita, Inc.; Analysis of Agreement 

Containing Consent Orders To Aid 

Public Comment 

AGENCY: Federal Trade Commission. 

ACTION: Proposed consent agreement. 

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 November 1, 2005. 

ADDRESSES: Interested parties are 

invited to submit written comments. 

Comments should refer to ‘‘DaVita, Inc., 

File No. 051 0051,’’ to facilitate the 

organization of comments. A comment 

filed in paper form should 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, NW., 

Washington, DC 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 as 

part of or as an attachment to email 

messages directed to the following email box: consentagreement@ftc.gov. 

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 

Web site, to the extent practicable, at 

http://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 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. 

FOR FURTHER INFORMATION CONTACT: 

Richard H. Cunningham, Bureau of 

Competition, 600 Pennsylvania Avenue, 

NW., Washington, DC 20580, (202) 326–

2214. 

SUPPLEMENTARY INFORMATION: Pursuant 

to section 6(f) of the Federal Trade 

Commission Act, 38 Stat. 721, 15 U.S.C. 

46(f), and § 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 October 4, 2005), on the 

World Wide Web, at http://www.ftc.gov/ 

os/2005/10/index.htm. A paper copy 

can be obtained from the FTC Public 

Reference Room, Room 130-H, 600 

Pennsylvania Avenue, NW, Washington, 

DC 20580, either in person or by calling 

(202) 326–2222. 

59070 Federal Register / Vol. 70, No. 195 / Tuesday, October 11, 2005 / Notices 

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 Orders (‘‘Consent 

Agreement’’) from DaVita Inc. 

(‘‘DaVita’’). The purpose of the Consent 

Agreement is to remedy the 

anticompetitive effects resulting from 

DaVita’s purchase of Gambro Healthcare 

Inc. (‘‘Gambro’’) from Gambro AB. 

Under the terms of the Consent 

Agreement, DaVita is required to divest 

69 dialysis clinics and terminate 2 

management services contracts in 35 

markets across the United States. 

The Consent Agreement has been 

placed on the public record for 30 days 

to solicit comments from interested 

persons. Comments received during this 

period will become part of the public 

record. After 30 days, the Commission 

will again review the Consent 

Agreement and the comments received, 

and will decide whether it should 

withdraw from the Consent Agreement 

or make it final. 

Pursuant to an Agreement dated 

December 6, 2004, DaVita proposes to 

acquire Gambro from Gambro AB for 

approximately $3.1 billion. 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. 18, and 

section 5 of the Federal Trade 

Commission Act, as amended, 15 U.S.C. 

45, by lessening competition in the 

market for the provision of outpatient 

dialysis services in 35 markets. 

II. The Parties 

Headquartered in El Segundo, 

California, DaVita is the second largest 

provider of outpatient dialysis services 

in the United States. DaVita operates 

665 outpatient dialysis clinics in 37 

states and the District of Columbia at 

which approximately 55,000 end stage 

renal disease (‘‘ESRD’’) patients receive 

treatment. In 2003, DaVita’s revenues 

were approximately $2.1 billion. 

Gambro AB is a publicly-traded 

Swedish corporation with worldwide 

operations focused in three business 

fields: operating dialysis centers, 

manufacturing dialysis equipment, and 

providing technology and products to 

blood centers and hospital blood banks. 

Gambro is Gambro AB’s entire U.S. 

dialysis services business. Gambro, 

headquartered in Denver, Colorado, is 

the third largest provider of outpatient 

dialysis services in the United States, 

with 565 outpatient dialysis clinics 

serving approximately 43,200 ESRD 

patients in 33 states and the District of 

Columbia. In 2003, Gambro’s revenues 

were approximately $1.8 billion. 

III. Outpatient Dialysis Services 

Outpatient dialysis services is the 

appropriate relevant product market in 

which to assess the effects of the 

proposed transaction. For patients 

suffering from ESRD, dialysis treatments 

are a life-sustaining therapy that 

replaces the function of the kidneys by 

removing toxins and excess fluid from 

the blood. Most ESRD patients receive 

dialysis treatments three times per week 

in sessions lasting between three and 

five hours. Kidney transplantation is the 

only alternative to dialysis for ESRD 

patients. However, the wait-time for 

donor kidneys—during which ESRD 

patients must receive dialysis 

treatments—can exceed five years. 

Additionally, many ESRD patients are 

not viable transplant candidates. As a 

result, many ESRD patients have no 

alternative to ongoing dialysis 

treatments. 

The relevant geographic markets for 

the provision of dialysis services are 

local in nature. They are limited by the 

distance ESRD patients are willing and/ 

or able to travel to receive dialysis 

treatments. Most ESRD patients are 

quite ill and suffer from multiple health 

problems. As such, it is difficult for 

ESRD patients to travel long distances 

for dialysis treatment. Generally, ESRD 

patients are unwilling and/or unable to 

travel further than 30 miles or 30 

minutes to receive dialysis treatments, 

depending on traffic patterns, local 

geography, and the patient’s proximity 

to the nearest center. As a result, 

competition among dialysis clinics 

occurs at a local level, corresponding to 

metropolitan areas or subsets thereof. 

Entry into the outpatient dialysis 

services markets addressed by the 

Consent Agreement on a level sufficient 

to deter or counteract the likely 

anticompetitive effects of the proposed 

transaction is not likely to occur in a 

timely manner. The primary barrier to 

entry is the difficulty associated with 

locating nephrologists with established 

patient pools to serve as medical 

directors. By law, each dialysis clinic 

must have a nephrologist medical 

director. As a practical matter, medical 

directors are essential to the success of 

a clinic because they are the primary 

source of referrals. The lack of available 

nephrologists with an established 

referral stream is a significant barrier to 

entry into each of the relevant markets. 

Beyond that, entry is also inhibited 

where certain attributes (such as a 

rapidly growing ESRD population, a 

favorable regulatory environment, 

average or below nursing and labor 

costs, and a low penetration of managed 

care) are not present, as is the case in 

many of the geographic markets 

identified in the Commission’s 

complaint. 

Each of the geographic markets 

addressed by the Consent Agreement is 

highly concentrated. The proposed 

acquisition represents a merger to 

monopoly in 11 markets and would 

cause the number of providers to drop 

from 3 to 2 in 13 other markets. 

Additionally, concentration increases 

significantly in the remaining 11 

markets addressed by the Consent 

Agreement. In each of these markets, the 

post-acquisition HHI exceeds 4,000, and 

the change in HHI is at least 800. The 

high post-acquisition concentration 

levels, along with evidence of DaVita 

and Gambro’s head-to-head competition 

in these markets, indicates that the 

combined firm would be able to exercise 

unilateral market power. The evidence 

shows that health insurance companies 

and other private payors who pay for 

dialysis services used by their members 

benefit from direct competition between 

DaVita and Gambro when negotiating 

the rates to be charged by the dialysis 

provider. As a result, the proposed 

combination likely would result in 

higher prices and diminished service 

and quality for outpatient dialysis 

services in many geographic markets. 

IV. The Consent Agreement 

The Consent Agreement effectively 

remedies the proposed acquisition’s 

anticompetitive effects in 35 markets 

where both DaVita and Gambro operate 

dialysis clinics by requiring DaVita to 

divest—prior to acquiring Gambro—68 

outpatient dialysis clinics to Renal 

Advantage and one outpatient dialysis 

clinic to its medical directors and their 

partners. The Consent Agreement also 

requires DaVita to terminate two 

management services agreements 

pursuant to which it manages outpatient 

dialysis clinics on behalf of third-party 

owners. As with the divestitures, 

termination of these management 

services agreements will ensure that 

these clinics remain viable independent 

competitors. 

As part of these divestitures, DaVita is 

required to obtain the agreement of the 

medical directors affiliated with the 

divested clinics to continue providing 

Federal Register / Vol. 70, No. 195 / Tuesday, October 11, 2005 / Notices 59071 

physician services after the transfer of 

ownership to Renal Advantage. 

Similarly, the Consent Agreement 

requires DaVita to obtain the consent of 

all lessors necessary to assign the leases 

for the real property associated with the 

divested clinics to Renal Advantage. 

These provisions ensure that Renal 

Advantage will have the assets 

necessary to operate the divested clinics 

in a competitive manner. 

The Consent Agreement contains 

several additional provisions designed 

to ensure that the divestitures are 

successful. First, the Consent Agreement 

provides Renal Advantage with the 

opportunity to interview and hire 

employees affiliated with the divested 

clinics and prevents DaVita from 

offering these employees incentives to 

decline Renal Advantage’s offer of 

employment. This will ensure that 

Renal Advantage has access to patient 

care and supervisory staff who are 

familiar with the clinics’ patients and 

the local physicians. Second, the 

Consent Agreement prevents DaVita 

from contracting with the medical 

directors (or their practice groups) 

affiliated with the divested clinics for 

three years. This provides Renal 

Advantage with sufficient time to build 

goodwill and a working relationship 

with its medical directors before DaVita 

can attempt to capitalize on its prior 

relationships in soliciting their services. 

Third, to ensure continuity of patient 

care and records as Renal Advantage 

implements its quality care, billing, and 

supply systems, the Consent Agreement 

allows DaVita to provide transition 

services for a period of 12 months. 

Firewalls and confidentiality 

agreements have been established to 

ensure that competitively sensitive 

information is not exchanged. Fourth, 

the Consent Agreement requires DaVita 

to provide Renal Advantage with a 

license to use DaVita’s policies and 

procedures, as well as the option to 

obtain DaVita’s medical protocols, 

which will further enhance Renal 

Advantage’s ability to provide 

continuity of care to patients. Finally, 

the Consent Agreement requires DaVita 

to provide prior notice to the 

Commission of its planned acquisitions 

of dialysis clinics located in the 35 

markets addressed by the Consent 

Agreement. This provision ensures that 

subsequent acquisitions do not 

adversely impact competition in the 

markets at issue and undermine the 

remedial goals of the proposed order. 

The Commission is satisfied that 

Renal Advantage is a qualified acquirer 

of the divested assets. Renal Advantage 

is a newly-formed company whose 

management has extensive experience 

operating, acquiring, and developing 

outpatient dialysis clinics. The 

company has received a substantial 

equity investment from Welsh, Carson, 

Anderson, and Stowe, which is the 

largest healthcare-focused private equity 

firm in the United States. 

The Commission has appointed Mitch 

Nielson and John Strack of FocalPoint 

Medical Consulting Group 

(‘‘FocalPoint’’) as Monitors to oversee 

the transition service agreements, and 

the implementation of, and compliance 

with, the Consent Agreement. Messrs. 

Nielson and Strack are the principles of 

FocalPoint, which provides consulting 

services to the healthcare industry. 

The purpose of this analysis is to 

facilitate public comment on the 

Consent Agreement, and it is not 

intended to constitute an official 

interpretation of the proposed Decision 

and Order or the Order to Maintain 

Assets, or to modify their terms in any 

way. 

By direction of the Commission. 

Donald S. Clark, 

Secretary. 

[FR Doc. 05–20312 Filed 10–7–05; 8:45 am] 

BILLING CODE 6750–01–P 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Centers for Disease Control and 

Prevention 

[60Day–06–05CW] 

Proposed Data Collections Submitted 

for Public Comment and 

Recommendations 

In compliance with the requirement 

of Section 3506(c)(2)(A) of the 

Paperwork Reduction Act of 1995 for 

opportunity for public comment on 

proposed data collection projects, the 

Centers for Disease Control and 

Prevention (CDC) will publish periodic 

summaries of proposed projects. To 

request more information on the 

proposed projects or to obtain a copy of 

the data collection plans and 

instruments, call 404–371–5983 and 

send comments to Seleda Perryman, 

CDC Assistant Reports Clearance 

Officer, 1600 Clifton Road, MS–D74, 

Atlanta, GA 30333 or send an e-mail to 

omb@cdc.gov. 

Comments are invited on: (a) Whether 

the proposed collection of information 

is necessary for the proper performance 

of the functions of the agency, including 

whether the information shall have 

practical utility; (b) the accuracy of the 

agency’s estimate of the burden of the 

proposed collection of information; (c) 

ways to enhance the quality, utility, and 

clarity of the information to be 

collected; and (d) ways to minimize the 

burden of the collection of information 

on respondents, including through the 

use of automated collection techniques 

or other forms of information 

technology. Written comments should 

be received within 60 days of this 

notice. 

Proposed Project 

Online Surveys to Measure 

Awareness of Chronic Fatigue 

Syndrome Public Awareness Campaign 

(OMB Control No. 0920–05CW)—New—

National Center for Health Marketing 

(NCHM), Centers for Disease Control 

and Prevention (CDC). 

Background and Brief Description 

Chronic fatigue syndrome (CFS) is a 

serious illness that affects many 

Americans. With as many as 900,000 

cases, many of which are misdiagnosed 

or left undiagnosed, the need for a CFS 

public education and awareness 

campaign is crucial. 

With an estimated $9.1 billion lost 

annually in U.S. productivity due to 

CFS, the economic impact is a 

substantial reason for Americans to take 

notice. More importantly, the 

diminished quality of life for many 

patients suffering from CFS is especially 

hard to manage. The lack of quality 

information regarding CFS makes it all 

the more difficult for those affected by 

CFS to receive the support and 

treatment needed to manage this illness. 

Research shows that 80 to 90 percent 

of patients have not been clinically 

diagnosed and are not receiving proper 

medical care. Lack of awareness and 

information among health care 

providers about CFS as a serious and 

treatable illness has created significant 

barriers to diagnosing and treating those 

who suffer from CFS. 

Congress recognized the need to 

change this scenario, as reported in the 

Committee Reports for the Senate 

Appropriations Committee (Senate 

Report 108–345—To accompany S. 2810 

Sept. 15, 2004) when the committee 

stated: 

Further, the Committee encourages CDC to 

better inform the public about this condition, 

its severity and magnitude and to use 

heightened awareness to create a registry of 

CFS patients to aid research in this field. 

During the next two years, CDC, in 

partnership with the Chronic Fatigue 

and Immune Dysfunction Syndrome 

(CFIDS) Association of America, will 

build the case that chronic fatigue 

syndrome is real, serious and should be 

diagnosed quickly to ensure the best 

possible health outcomes.