78872 Federal Register / Vol. 79, No. 250 / Wednesday, December 31, 2014 / Notices 

1 In particular, the written request for confidential 

treatment that accompanies the comment must 

include the factual and legal basis for the request, 

and must identify the specific portions of the 

comment to be withheld from the public record. See 

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

Further, the Order requires PSA to 

notify USFSA and ISI that the Order 

will prevent PSA from doing on behalf 

of USFSA or ISI anything that, if done 

by PSA, would be inconsistent with the 

Order against PSA. This is necessary 

because PSA provides various education 

services on ethics to both USFA and ISI 

coaches. 

Paragraph IV of the Proposed Order 

requires PSA to design, maintain, and 

operate an antitrust compliance 

program. PSA must have an Antitrust 

Compliance Officer for the duration of 

the Proposed Order. For a period of five 

years, PSA must provide guidance to its 

staff, employees, members, and leaders 

concerning the antitrust laws and PSA 

obligations under the Proposed Order. 

PSA also must implement policies and 

procedures to enable persons to ask 

questions about, and report violations 

of, the Proposed Order and the antitrust 

laws confidentially and without fear of 

retaliation, and to discipline its leaders, 

employees and agents for failure to 

comply with the Proposed Order. 

Paragraphs V–VII of the Proposed 

Order require certain standard 

compliance reporting, cooperation, and 

access. 

The Proposed Order will expire in the 

20 years. 

By direction of the Commission. 

Janice Podoll Frankle, 

Acting Secretary. 

[FR Doc. 2014–30649 Filed 12–30–14; 8:45 am] 

BILLING CODE 6750–01–P 

FEDERAL TRADE COMMISSION 

[File No. 141 0142] 

Eli Lilly and Company and Novartis 

AG; Analysis of Proposed 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 methods 

of competition. The attached Analysis to 

Aid Public Comment describes both the 

allegations in the draft complaint and 

the terms of the consent orders— 

embodied in the consent agreement— 

that would settle these allegations. 

DATES: Comments must be received on 

or before January 21, 2015. 

ADDRESSES: Interested parties may file a 

comment at https://

ftcpublic.commentworks.com/ftc/

elilillyconsent online or on paper, by 

following the instructions in the 

Request for Comment part of the 

SUPPLEMENTARY INFORMATION section 

below. Write ‘‘Eli Lilly and Company 

and Novartis A.G.—Consent Agreement; 

File No. 141–0142’’ on your comment 

and file your comment online at 

https://ftcpublic.commentworks.com/

ftc/elilillyconsent by following the 

instructions on the web-based form. If 

you prefer to file your comment on 

paper, write ‘‘Eli Lilly and Company 

and Novartis A.G.—Consent Agreement; 

File No. 141–0142’’ on your comment 

and on the envelope, and mail your 

comment to the following address: 

Federal Trade Commission, Office of the 

Secretary, 600 Pennsylvania Avenue 

NW., Suite CC–5610 (Annex D), 

Washington, DC 20580, or deliver your 

comment to the following address: 

Federal Trade Commission, Office of the 

Secretary, Constitution Center, 400 7th 

Street SW., 5th Floor, Suite 5610 

(Annex D), Washington, DC 20024. 

FOR FURTHER INFORMATION CONTACT: 

Michael Barnett, Bureau of Competition, 

(202–326–2362), 600 Pennsylvania 

Avenue NW., Washington, DC 20580. 

SUPPLEMENTARY INFORMATION: Pursuant 

to Section 6(f) of the Federal Trade 

Commission Act, 15 U.S.C. 46(f), and 

FTC Rule 2.34, 16 CFR 2.34, notice is 

hereby given that the above-captioned 

consent agreement containing consent 

orders 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 December 22, 2014), on 

the World Wide Web, at http://

www.ftc.gov/os/actions.shtm. 

You can file a comment online or on 

paper. For the Commission to consider 

your comment, we must receive it on or 

before January 21, 2015. Write ‘‘Eli Lilly 

and Company and Novartis A.G.— 

Consent Agreement; File No. 141–0142’’ 

on your comment. Your comment— 

including your name and your state— 

will be placed on the public record of 

this proceeding, including, to the extent 

practicable, on the public Commission 

Web site, at http://www.ftc.gov/os/

publiccomments.shtm. As a matter of 

discretion, the Commission tries to 

remove individuals’ home contact 

information from comments before 

placing them on the Commission Web 

site. 

Because your comment will be made 

public, you are solely responsible for 

making sure that your comment does 

not include any sensitive personal 

information, like anyone’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. You are also solely responsible 

for making sure that your comment does 

not include any sensitive health 

information, like medical records or 

other individually identifiable health 

information. In addition, do not include 

any ‘‘[t]rade secret or any commercial or 

financial information which . . . is 

privileged or confidential,’’ as discussed 

in Section 6(f) of the FTC Act, 15 U.S.C. 

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

4.10(a)(2). In particular, do not include 

competitively sensitive information 

such as costs, sales statistics, 

inventories, formulas, patterns, devices, 

manufacturing processes, or customer 

names. 

If you want the Commission to give 

your comment confidential treatment, 

you must file it in paper form, with a 

request for confidential treatment, and 

you have to follow the procedure 

explained in FTC Rule 4.9(c), 16 CFR 

4.9(c).1 Your comment will be kept 

confidential only if the FTC General 

Counsel, in his or her sole discretion, 

grants your request in accordance with 

the law and the public interest. 

Postal mail addressed to the 

Commission is subject to delay due to 

heightened security screening. As a 

result, we encourage you to submit your 

comments online. To make sure that the 

Commission considers your online 

comment, you must file it at https://

ftcpublic.commentworks.com/ftc/

elilillyconsent by following the 

instructions on the web-based form. If 

this Notice appears at http://

www.regulations.gov/#!home, you also 

may file a comment through that Web 

site. 

If you file your comment on paper, 

write ‘‘Eli Lilly and Company and 

Novartis A.G.—Consent Agreement; File 

No. 141–0142’’ on your comment and 

on the envelope, and mail your 

comment to the following address: 

Federal Trade Commission, Office of the 

Secretary, 600 Pennsylvania Avenue 

NW., Suite CC–5610 (Annex D), 

Washington, DC 20580, or deliver your 

comment to the following address: 

Federal Trade Commission, Office of the 

Secretary, Constitution Center, 400 7th 

Street SW., 5th Floor, Suite 5610 

(Annex D), Washington, DC 20024. If 

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Federal Register / Vol. 79, No. 250 / Wednesday, December 31, 2014 / Notices 78873 

possible, submit your paper comment to 

the Commission by courier or overnight 

service. 

Visit the Commission Web site at 

http://www.ftc.gov to read this Notice 

and the news release describing it. 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 on or 

before January 21, 2015. You can find 

more information, including routine 

uses permitted by the Privacy Act, in 

the Commission’s privacy policy, at 

http://www.ftc.gov/ftc/privacy.htm. 

Analysis of Agreement Containing 

Consent Orders 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 Eli Lilly and 

Company (‘‘Eli Lilly’’), which is 

designed to remedy the anticompetitive 

effects of Eli Lilly’s acquisition of the 

Novartis Animal Health business 

(‘‘Novartis Animal Health’’) from 

Novartis AG (‘‘Novartis’’). 

The proposed Consent Agreement has 

been placed on the public record for 

thirty days for receipt of comments from 

interested persons. Comments received 

during this period will become part of 

the public record. After thirty days, the 

Commission will again evaluate the 

proposed Consent Agreement, along 

with the comments received, in order to 

make a final decision as to whether it 

should withdraw from the proposed 

Consent Agreement, modify it, or make 

final the Decision and Order (‘‘Order’’). 

Pursuant to a Stock and Asset 

Purchase Agreement dated April 22, 

2014, Eli Lilly proposes to acquire 

Novartis Animal Health for 

approximately $5.4 billion (the 

‘‘Proposed Acquisition’’). Both parties 

sell canine heartworm parasiticide 

products in the United States. The 

Commission alleges in its Complaint 

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 U.S. market for canine heartworm 

parasiticides. The proposed Consent 

Agreement will remedy the alleged 

violations by preserving the competition 

that would otherwise be eliminated by 

the Proposed Acquisition. Specifically, 

under the terms of the Consent 

Agreement, Eli Lilly is required to 

divest all of the rights and assets related 

to Sentinel Spectrum and Sentinel 

Flavor Tabs (‘‘the Sentinel products’’). 

Eli Lilly has proposed Virbac S.A. 

(‘‘Virbac’’) as the buyer of the rights and 

assets related to the Sentinel products. 

II. The Relevant Product and Structure 

of the Market 

The relevant product market in which 

to analyze the Proposed Acquisition is 

no broader than all canine heartworm 

parasiticides. Canine heartworm 

parasiticides are medications used to 

treat heartworm disease in dogs. 

Heartworm disease is a potentially fatal 

condition caused by parasitic worms 

living in the arteries of a dog’s heart and 

lungs. Canine heartworm parasiticides 

primarily target heartworm, but the 

various products in the category have 

different attributes. For example, some 

canine heartworm parasiticides also 

treat other internal parasites, such as 

hookworm, roundworm, whipworm and 

tapeworm, and/or external parasites, 

like fleas. Canine parasiticides are 

offered in oral, topical, and injectable 

formulations, with most customers 

preferring the oral ones. 

The United States is the relevant 

geographic market in which to assess 

the competitive effects of the Proposed 

Acquisition. Canine heartworm 

parasiticides must be approved by the 

FDA or EPA before being sold in the 

United States. Thus, canine heartworm 

parasiticides sold outside the United 

States, but not approved for sale in the 

United States, are not alternatives for 

U.S. consumers. 

The market for canine heartworm 

parasiticides in the United States is 

highly concentrated. Eli Lilly, which 

markets Trifexis, is the market leader 

with a share in excess of 35%. Merial 

Limited, which sells Heartgard and 

Heartgard Plus, is the second-leading 

supplier, with a share of 30%. Heartgard 

and Heartgard Plus are oral products but 

do not treat fleas. Novartis’s Sentinel 

product line has an 8% market share. 

The only other significant supplier is 

Zoetis Inc., which supplies Revolution 

and ProHeart 6. Revolution is a 

combination product that requires 

topical application. ProHeart 6 is an 

injectable product that does not impact 

fleas. Thus, the Acquisition would 

consolidate the two closest competitors, 

would substantially increase 

concentration, and would produce a 

single firm controlling more than 43% 

of the relevant market. 

III. Entry 

Entry into the U.S. market for canine 

heartworm parasiticides would not be 

timely, likely, or sufficient in 

magnitude, character, and scope to deter 

or counteract the anticompetitive effects 

of the Proposed Acquisition. Three 

major obstacles stand in the way of a 

prospective canine heartworm 

parasiticide entrant: Lengthy 

development timeframes, FDA and 

other agency approval requirements, 

and difficulty of establishing a brand 

name and convincing veterinarians to 

prescribe new products. 

IV. Effects of the Acquisition 

Eli Lilly’s acquisition of Novartis 

Animal Health will adversely affect 

competition in the market for canine 

heartworm parasiticides by eliminating 

close head-to-head competition between 

Trifexis and the Sentinel products. 

Trifexis and the Sentinel products are 

each other’s closest competitors 

because, among other reasons, they are 

the only oral heartworm products that 

impact fleas. Flea prevention combined 

with heartworm prevention in one oral 

treatment is particularly important as it 

combines the convenience of a single 

oral treatment while avoiding the mess 

and smell of topical products. In 

addition, Trifexis and the Sentinel 

products are the only oral combination 

products that treat whipworm. These 

attributes provide a scope of treatment 

and ease of use not available with other 

canine heartworm parasiticides. Absent 

a remedy, the Proposed Acquisition 

would likely result in higher prices for 

consumers due to the ability of Eli Lilly 

to effect a unilateral price increase. 

V. The Consent Agreement 

The proposed Consent Agreement 

effectively remedies the Proposed 

Acquisition’s anticompetitive effects in 

the canine heartworm parasiticide 

market by requiring the parties to divest 

the rights and assets related to the 

Sentinel products to Virbac. This 

divestiture will preserve the close 

competition between the only two oral 

products on the market indicated for the 

treatment of heartworm, other internal 

worms, and fleas in dogs. 

Virbac is a multinational 

pharmaceutical company headquartered 

in Carros, France with approximately 

4,350 employees. In 2013, the company 

generated $934 million in global 

revenues. Companion animal products 

comprise 56% of Virbac sales, making it 

the sixth-largest veterinary product 

company in the companion animal 

products business. Virbac operates in 

the United States through its subsidiary, 

Virbac Corp., which focuses on canine, 

feline, and equine pharmaceutical and 

hygiene products. Virbac Corp. has 350 

employees, and had $130 million in 

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78874 Federal Register / Vol. 79, No. 250 / Wednesday, December 31, 2014 / Notices 

revenue in 2013. Virbac Corp. is well 

suited to acquire the Sentinel products 

because of its current presence in the 

companion animal health business, and 

because it already has experience with 

canine heartworm products. Although 

Virbac currently sells canine heartworm 

products, their sales are relatively small 

and, because they do not contain an 

active ingredient to treat fleas, their 

competitive interaction with the 

Sentinel products is limited. 

The Order requires Eli Lilly to divest 

all of its respective rights and interests 

in the Sentinel products no later than 

ten days after the consummation of the 

Proposed Acquisition or on the date on 

which the Order becomes final, 

whichever is earlier. The divestiture 

includes all regulatory approvals, brand 

names, marketing materials, and 

confidential business information, 

including customer information, related 

to the Sentinel products, and other 

assets associated with producing, 

marketing and selling the Sentinel 

products. To ensure the divestiture is 

successful, the Order requires Eli Lilly 

and Novartis to secure all third-party 

consents and waivers required to permit 

Virbac to conduct business with the 

Sentinel products. The Order also 

requires Eli Lilly to divest supply chain 

assets related to the Sentinel products. 

These assets include certain rights and 

intellectual property for the active 

pharmaceutical ingredients in the 

Sentinel products. Additionally, Eli 

Lilly and Virbac must complete a 

technical transfer of manufacturing from 

Novartis to Virbac. The Order calls for 

an interim supply agreement of the 

Sentinel products for up to four years 

while Eli Lilly and Virbac complete the 

technical transfer. 

The Commission has agreed to 

appoint an Interim Monitor to ensure 

that Eli Lilly and Novartis comply with 

all of their obligations pursuant to the 

Consent Agreement and to keep the 

Commission informed about the status 

of the transfer of the rights and assets to 

Virbac. 

The Commission’s goal in evaluating 

possible purchasers of divested rights 

and assets is to maintain the 

competitive environment that existed 

prior to the Proposed Acquisition. If the 

Commission determines that Virbac is 

not an acceptable acquirer of the 

divested rights and assets, or that the 

manner of the divestitures is not 

acceptable, the parties must unwind the 

sale of rights and assets to Virbac and 

divest them to a Commission-approved 

acquirer within six months of the date 

the Order becomes final. In that 

circumstance, the Commission may 

appoint a trustee to divest the rights and 

assets if the parties fail to divest them 

as required. 

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 Order or 

to modify its terms in any way. 

By direction of the Commission. 

Janice Podoll Frankle, 

Acting Secretary. 

[FR Doc. 2014–30686 Filed 12–30–14; 8:45 am] 

BILLING CODE 6750–01–P 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Food and Drug Administration 

[Docket No. FDA–2014–D–2254] 

The Drug Supply Chain Security Act 

Implementation: Product Tracing 

Requirements—Compliance Policy; 

Guidance for Industry; Availability 

AGENCY: Food and Drug Administration, 

HHS. 

ACTION: Notice. 

SUMMARY: The Food and Drug 

Administration (FDA) is announcing the 

availability of a guidance for industry 

entitled ‘‘DSCSA Implementation: 

Product Tracing Requirements— 

Compliance Policy.’’ This guidance 

announces FDA’s intention with regard 

to enforcement of certain product 

tracing requirements of the Federal 

Food, Drug, and Cosmetic Act (FD&C 

Act), as added by the Drug Supply 

Chain Security Act (DSCSA). FDA does 

not intend to enforce these requirements 

against manufacturers, wholesale 

distributors, and repackagers who do 

not, prior to May 1, 2015, provide or 

capture the transaction information, 

transaction history, and transaction 

statement required by the FD&C Act 

(product tracing information) for 

transaction of certain human, finished 

prescription drugs that are covered in 

the statute. 

DATES: Effective December 31, 2014. For 

information about enforcement dates, 

please see the SUPPLEMENTARY

INFORMATION section. 

ADDRESSES: All responses to this notice 

should be identified with Docket No. 

FDA–2014–D–2254 and directed to the 

office listed in the FOR FURTHER

INFORMATION CONTACT section of this 

document. 

FOR FURTHER INFORMATION CONTACT: 

Office of Compliance, Center for Drug 

Evaluation and Research, Food and 

Drug Administration, 10903 New 

Hampshire Ave., Silver Spring, MD 

20993–0002, 301–796–3100, 

drugtrackandtrace@fda.hhs.gov. 

SUPPLEMENTARY INFORMATION: 

I. Background 

FDA is announcing the availability of 

a guidance for industry entitled 

‘‘DSCSA Implementation: Product 

Tracing Requirements—Compliance 

Policy.’’ This guidance is being issued 

consistent with FDA’s good guidance 

practices regulation (21 CFR 10.115). 

This guidance has been implemented 

without prior public comment because 

the Agency has determined that prior 

public participation is not feasible or 

appropriate. (§ 10.115(g)(2)). This 

guidance document provides 

information pertaining to statutory 

requirements that will take effect on 

January 1, 2015, regarding the 

provisions to provide and capture 

product tracing information under 

section 582(b)(1), (c)(1), and (e)(1) of the 

FD&C Act (21 U.S.C. 360eee–1(b)(1), 

(c)(1), and (e)(1)). It is important that 

FDA provide this information before 

that date. Although this guidance 

document is immediately in effect, it 

remains subject to comment in 

accordance with the Agency’s good 

guidance practices. (§ 10.115(g)(3)). 

On November 27, 2013, the DSCSA 

(Title II of Pub. L. 113–54) was signed 

into law. Section 202 of the DSCSA 

added sections 581 and 582 to the FD&C 

Act, which set forth new definitions and 

requirements for the tracing of products 

through the pharmaceutical distribution 

supply chain. Starting in 2015, trading 

partners (manufacturers, wholesale 

distributors, dispensers, and 

repackagers) will be required under 

section 582(b)(1), (c)(1), (d)(1), and (e)(1) 

of the FD&C Act, to exchange product 

tracing information when engaging in 

transactions involving certain 

prescription drugs. Manufacturers, 

wholesale distributors, and repackagers 

must meet these requirements by 

January 1, 2015; dispensers must meet 

these requirements by July 1, 2015. 

Although the product tracing 

requirements under section 582(b), (c), 

and (e) of the FD&C Act go into effect 

for manufacturers, wholesale 

distributors, and repackagers on January 

1, 2015, some trading partners have 

expressed concern that unforeseen 

complications with the exchange of the 

required information may result in 

disruptions in the pharmaceutical 

supply chain, and ultimately could 

impact patients’ access to needed 

prescription drugs. FDA recognizes that 

some manufacturers, wholesale 

distributors, and repackagers may need 

time beyond January 1, 2015, to work 

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