Hospitals sue BD, distributors, GPOs over alleged safety syringe monopoly

A group of healthcare providers levied a purported class action against BD, its distributors and group purchasing organizations accusing them of running a monopoly on the U.S. safety syringe market.

The lawsuit, brought in the U.S. District Court for Southern Illinois, was filed on behalf of “healthcare providers nationwide” by a group of providers “who have purchased conventional and safety syringes and safety IV catheters directly from the conspiracy and paid above-competitive prices caused by the conspiracy.”

The suit names BD, Premier Inc. (NSDQ:PINC), Vizient, Cardinal Health (NYSE:CAH), Owens & Minor (NYSE:OMI), Henry Schein (NSDQ:HSIC) and “other unknown Becton distributors” as defendants.

“Becton, a manufacturer of devices and supplies, has abused its extraordinary market power to require the use of oppressive, anti-competitive contracts that effectively force above-competitive prices on the market,” the suit alleged. “Defendants have exploited that network of contracts to enter into a vertical conspiracy to restrain trade in the nationwide markets for conventional and safety syringes and safety IV catheters. Using those contracts, Becton has unlawfully conspired with GPOs and distributors to force healthcare providers into long-term exclusionary contracts that restrain trade and inflate the prices of certain Becton products to above-competitive levels.”

Providers are forced to buy BD safety products “or else face substantial economic punishment” due to the defendants’ “tremendous market power,” the suit alleged.

“Defendants have profited greatly from the above-competitive pricing that they have charged for the relevant Becton products,” according to the complaint, filed by Marion Diagnostic Center, Marion HealthCare and Andron Medical Assoc.

“Through their conspiracy, defendants have suppressed competition by preventing Becton’s rivals from obtaining sufficient market shares to bid Becton’s prices down to economically efficient, competitive levels. The conspiracy has also suppressed conventional and safety syringe innovation and safety, placing patients and healthcare workers at needless risk of serious infectious diseases spread by needlesticks and blood-borne pathogens,” the plaintiffs alleged.

The lawsuit seeks a judgment that the defendants violated the Sherman Act, meaning the potential for triple damages, an injunction barring further conspiracy, pre-d and post-judgment interest and legal costs.