One of the Good Guys
October 21, 2009
Posted by chcablogadmin in : Cost Reduction, Group Purchasing, Industry Trends
Consolidation of nearly every segment of health care certainly has been the trend over the last 10 to 15 years. Consolidation of everything from wholesalers to suture providers and vaccine makers has effectively limited market competition in these areas.
In 1990, there were 13 producers of plasma-derived products. In 2009, only five remain. In 2008, the Australian-based CSL attempted to acquire U.S.-based Talecris, which would have combined the second and third largest producers of plasma-derived protein therapies. CHCA worked with the FTC and the other major GPOs in fighting the merger to keep a more competitive blood product market place. We were successful in pointing out that a merger would have substantially reduced the competition for four plasma-derived protein therapies: immune, globulin, albumin, and rho-D and alpha one antitrypsin disease. Your children’s hospitals use these therapies to treat illness such as primary immunodeficiency diseases, chronic inflammatory demyelinating polyneuropathy, alpha one antitrypsin disease, Kawasaki’s syndrome, idiopathic thrombocytopenia (ITP), and hemolytic diseases in newborns.
This whole process brings to issue whether the role of the GPOs in consolidating major pieces of business really promotes good competition or sets the stage for this type of oligopoly in other health-related industries. When Premier and Novation control well over 50 percent of hospital purchasing in the United States, one does begin to question whether bigger is better. In this case, the industry rallied together and effectively worked with the FTC. I hope we have the chance to do it again in the future.
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