Invidious Price Discrimination in the Sale of Rapid Acting Insulin: Is There An Antitrust Remedy?

12 Pages Posted: 9 Aug 2019 Last revised: 3 Oct 2019

Date Written: Oct. 2, 2019

Abstract

Price discrimination is rampant in the sale of rapid acting insulin and other patented drugs. That discrimination frequently results in uninsured or under-insured patients paying the highest prices. I focus here primarily on the possibility that the targeted price discrimination in the marketing of rapid acting insulin could constitute abusive conduct by a dominant firm. My conclusion is that, while price discrimination is not the primary cause of high insulin prices, it is key to an abusive scheme that reduces output, raises prices for vulnerable patients, and constitutes a clear consumer welfare injury. This coercive conduct should give rise to valid claims for monopolization or attempted monopolization, for related claims under the Robinson Patman Act, or for a separate violation of Section 5 of the FTC Act. The broader implications are that a sound antitrust remedy may exist for invidious price discrimination that targets disadvantaged groups, as may occur in the marketing of patented drugs and products with strong trademarks.

Keywords: Prescription Drug Prices, Price Discrimination, Abusive Conduct, Monopolization, Attempted Monopolization

JEL Classification: K21, I11, I13, I14

Suggested Citation

Grimes, Warren S., Invidious Price Discrimination in the Sale of Rapid Acting Insulin: Is There An Antitrust Remedy? (Oct. 2, 2019). American Antitrust Institute, 2019; Southwestern Law School Research Paper No. 2019/09. Available at SSRN: https://ssrn.com/abstract=3433305

Warren S. Grimes (Contact Author)

Southwestern Law School ( email )

3050 Wilshire Blvd.
Los Angeles, CA 90010
United States

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