FTC Staff Opinion: Community CarePartners, Inc.'s Proposed Discount Rx Program Exempt From the Robinson-Patman Act

In a letter issued today, the staff of the Federal Trade Commission advised Community CarePartners, Inc. that its proposal to provide pharmaceuticals purchased at a discount to in-home hospice patients is exempt from the Robinson-Patman Act, a U.S. antitrust law that prohibits anticompetitive price discrimination.

CarePartners asked the FTC whether it may provide discounted pharmaceuticals available to eligible non-profit entities to hospice patients receiving treatment in their homes and still qualify for the exemption.

The Non-Profit Institutions Act, or NPIA, exempts from the Robinson-Patman Act certain eligible non-profit entities that purchase supplies for their own use.

According to the FTC staff opinion letter, the proposed program meets the requirements of the NPIA. First, CarePartners is an eligible institution under the NPIA. Second, consistent with existing case law, the use of the NPIA-discounted pharmaceuticals in connection with treatment of in-home hospice patients admitted to CarePartners’ Hospice Program falls within the “own use” requirement of the statute. Therefore, according to staff, the proposed program appears to fall within the NPIA.

NOTE: This letter sets out the views of the staff of the FTC’s Bureau of Competition, as authorized by the Commission’s Rules of Practice. It has not been reviewed or approved by the Commission. As the Commission’s Rules explain, the staff’s advice is rendered “without prejudice to the right of the Commission later to rescind the advice and, where appropriate, to commence an enforcement proceeding.”

(NPIA Opinion.final)