My Aching Hip, Part II
Several weeks ago, news broke that DOJ’s antitrust division was investigating several orthopedic device manufacturer. On Friday, the AP reported that:
Makers of orthopedics devices received a lift Friday on the belief an antitrust probe into the sector will not be as prohibitive as originally thought after comments from Stryker Corp.’s chief executive that the scope of their investigation had been narrowed. … Stryker CEO Stephen MacMillan told analysts late Thursday in a conference call that the scope of the investigation had narrowed. The CEO agreed it was fair to say the probe was focused on one of the company’s specific businesses, rather than the company itself, and did not comment further.
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July 26th, 2006 at 9:32 pm
[…] EasyBourse has an interesting piece on the events giving rise the current DoJ probe into the orthopedics market. Looks like an invitation to collude case to me: According to Zimmer [Holdings, Inc. - ZMH], which released second-quarter results after the closing bell Wednesday, a string of events appears to have touched off the probe. In the fall of 2005, a representative at a hospital sent an email to orthopedics companies with a bid proposal regarding orthopedic implant pricing, Zimmer said in its earnings release, which also detailed the antitrust investigation. “Upon receipt of that email, a representative of one of Zimmer’s competitors sent an unsolicited message to the same group of competitors that received the hospital’s original message,” Zimmer said. “The competitor’s email proposed that the orthopaedic companies adopt a uniform pricing strategy in responding to this hospital.” Zimmer did not name the competitor company in question. Zimmer and its local independent distributor rejected this proposal, stating “emphatically” in writing that neither Zimmer nor the distributor would participate in the pricing discussions with competitors, Zimmer said. You can also bookmark this on del.icio.us or check the cosmos […]