Surescripts files motion to dismiss FTC e-prescribing claim

Surescripts is contending that a Federal Trade Commission complaint filed earlier this year in federal court should be dismissed because of a combination of factual and merit-based errors.

While the FTC alleges that Surescripts has engaged in a “long-running anticompetitive scheme” to maintain its e-prescribing monopolies, the company’s motion to dismiss filed on Friday claims that two of the foundational facts the agency uses to support its case are “demonstrably false” and have resulted in an inaccurate description of its business practices.

Specifically, the FTC alleges that “decade-long monopolies” in the e-prescribing routing and eligibility markets have produced higher prices, reduced quality, stifled innovation, suppressed output, as well as stymied alternative business models.

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Also See: FTC sues Surescripts, charging anticompetitive actions in e-prescribing

“We continue to be disappointed at the allegations made by the Federal Trade Commission,” said Surescripts CEO Tom Skelton in a written statement. “We wholeheartedly share the FTC’s focus on lowering healthcare costs, and we have achieved significant reductions with e-prescribing for many years. However, the FTC’s complaint makes significant factual errors about Surescripts’ business and mischaracterizes the economic realities of the e-prescribing market. As such, our counsel has filed a motion to dismiss based on the facts and merits of the case.”

According to Surescripts, one of the FTC’s factual errors in its case cites the company’s contracts with electronic health records vendor Epic as a key example of a loyalty provision that would require them to maintain exclusivity to Surescripts for the term of the contract.

However, Surescripts insists that its contract with Epic “does not and has never had an exclusivity requirement,” nor do any contracts with the EHR vendor’s customers contain express exclusivity requirements.

In addition, Surescripts objects to the FTC’s description of its contracts as including a penalty provision that the agency says would discourage EHRs from using multiple networks or switching away from Surescripts by requiring EHRs to repay loyalty incentives that they previously earned.

“There is no such requirement for any EHR to pay back any incentive payment earned following a notice of termination, and EHRs may freely terminate with just six months’ notice,” contends Surescripts.

Another point of contention for the company is what it describes as a misrepresentation by the FTC of the “economic reality of the e-prescribing market when it makes a theoretical claim that prices could have fallen by more than the 70 percent that Surescripts achieved.”

On the point, Skelton notes that “while the cost of American healthcare overall continues to rise, Surescripts has reduced the cost of e-prescribing by 70 percent since 2009, a goal we will continue to focus on as a critical part of our business.”

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