By Warren S. Grimes (Southwestern Law School)
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 discrimination 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 for antitrust policy are that discrimination that targets disadvantaged groups is common in the marketing of patented drugs and can also occur in the marketing of other products, such as strongly branded, trademarked products.