On September 5, 2014 the United States District Court for the Eastern District of Pennsylvania denied Merck’s motion to dismiss Plaintiffs’ antitrust claims. In doing so, the court held that Plaintiffs had sufficiently alleged claims for violations of the Sherman Act. First, Plaintiffs demonstrated that Merck, as the sole manufacturer of the MMR vaccine, had monopoly power in the market. Second, Plaintiffs sufficiently alleged that Merck willfully maintained such monopoly power through falsifying data related to the efficacy of the MMR vaccine. Accordingly the court held that “taking the facts in the light most favorable to Plaintiffs, Defendant’s fraudulent misrepresentations about Defendant’s own product, coupled with the unique facts of the this case (e.g., the 100% monopoly of the market and arguable statutory and contractual duties to disclose information) create the basis for an antitrust claims that Defendant willfully maintained monopoly power through exclusionary tactics.”
History of the case:
In 2012 an antitrust case was filed in the United States District Court for the Eastern District of Pennsylvania. The lawsuit, Chatom Primary Care, P.C. v. Merck, was filed as a class action against Merck for unlawfully monopolizing the U.S. market for Mumps Vaccine by misrepresenting the true efficacy of its vaccine. Specifically, the lawsuit states Merck fraudulently misrepresented and marketed its Mumps Vaccine as having an efficacy rate of 95% or higher. Plaintiffs allege that in reality, Merck knew and concealed that the Mumps Vaccine was far less than 95% effective.
· Merck used improper testing techniques and falsified its data to show fraudulent efficacy rates, even after significant mumps outbreaks in 2006 and 2009.
· As the only company licensed by the U.S. to sell the Mumps Vaccine, Merck has illegally monopolized the market with its inflated 95% or greater efficacy rate, which has deterred and excluded competitors from entering the marketplace.
· Merck created a high inelasticity of demand in the marketplace. The government, health care professionals or consumers have no other option to obtain the Mumps immunization.
· Because Merck was free to charge an artificially inflated price and free competition was limited in the marketplace, antitrust laws were violated.