[Federal Register Volume 71, Number 49 (Tuesday, March 14, 2006)]
[Notices]
[Pages 13128-13129]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-3550]


=======================================================================
-----------------------------------------------------------------------

FEDERAL TRADE COMMISSION

[File No. 061 0031]


Allergan, Inc. and Inamed Corporation; Analysis of Agreement 
Containing Consent Orders To Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement.

-----------------------------------------------------------------------

SUMMARY: The consent agreement in this matter settles alleged 
violations of Federal law prohibiting unfair or deceptive acts or 
practices or unfair methods of competition. The attached Analysis to 
Aid Public Comment describes both the allegations in the draft 
complaint and the terms of the consent order--embodied in the consent 
agreement--that would settle these allegations.

DATES: Comments must be received on or before April 7, 2006.

ADDRESSES: Interested parties are invited to submit written comments. 
Comments should refer to ``Allergan, Inc. and Inamed Corp., File No. 
061 0031,'' to facilitate the organization of comments. A comment filed 
in paper form should include this reference both in the text and on the 
envelope, and should be mailed or delivered to the following address: 
Federal Trade Commission/Office of the Secretary, Room 135-H, 600 
Pennsylvania Avenue, NW., Washington, DC 20580. Comments containing 
confidential material must be filed in paper form, must be clearly 
labeled ``Confidential,'' and must comply with Commission Rule 4.9(c). 
16 CFR 4.9(c) (2005).\1\ The FTC is requesting that any comment filed 
in paper form be sent by courier or overnight service, if possible, 
because U.S. postal mail in the Washington area and at the Commission 
is subject to delay due to heightened security precautions. Comments 
that do not contain any nonpublic information may instead be filed in 
electronic form as part of or as an attachment to e-mail messages 
directed to the following e-mail box: [email protected].
---------------------------------------------------------------------------

    \1\ The comment must be accompanied by an explicit request for 
confidential treatment, including the factual and legal basis for 
the request, and must identify the specific portions of the comment 
to be withheld from the public record. The request will be granted 
or denied by the Commission's General Counsel, consistent with 
applicable law and the public interest. See Commission Rule 4.9(c), 
16 CFR 4.9(c).
---------------------------------------------------------------------------

    The FTC Act and other laws the Commission administers permit the 
collection of public comments to consider and use in this proceeding as 
appropriate. All timely and responsive public comments, whether filed 
in paper or electronic form, will be considered by the Commission, and 
will be available to the public on the FTC Web site, to the extent 
practicable, at http://www.ftc.gov. As a matter of discretion, the FTC 
makes every effort to remove home contact information for individuals 
from the public comments it receives before placing those comments on 
the FTC Web site. More information, including routine uses permitted by 
the Privacy Act, may be found in the FTC's privacy policy, at http://www.ftc.gov/ftc/privacy.htm.

FOR FURTHER INFORMATION CONTACT: James E. Southworth, Bureau of 
Competition, 600 Pennsylvania Avenue, NW., Washington, DC 20580, (202) 
326-2822.

SUPPLEMENTARY INFORMATION: Pursuant to section 6(f) of the Federal 
Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46(f), and Sec.  2.34 of 
the Commission Rules of Practice, 16 CFR 2.34, notice is hereby given 
that the above-captioned consent agreement containing a consent order 
to cease and desist, having been filed with and accepted, subject to 
final approval, by the Commission, has been placed on the public record 
for a period of thirty (30) days. The following Analysis to Aid Public 
Comment describes the terms of the consent agreement, and the 
allegations in the complaint. An electronic copy of the full text of 
the consent agreement package can be obtained from the FTC Home Page 
(for March 8, 2006), on the World Wide Web, at http://www.ftc.gov/os/2006/03/index.htm. A paper copy can be obtained from the FTC Public 
Reference Room, Room 130-H, 600 Pennsylvania Avenue, NW., Washington, 
DC 20580, either in person or by calling (202) 326-2222.
    Public comments are invited, and may be filed with the Commission 
in either paper or electronic form. All comments should be filed as 
prescribed in the ADDRESSES section above, and must be received on or 
before the date specified in the DATES section.

Analysis of Agreement Containing Consent Order To Aid Public Comment

    The Federal Trade Commission (``Commission'') has accepted, subject 
to final approval, an Agreement Containing Consent Orders (``Consent 
Agreement'') from Allergan, Inc. (``Allergan'') and Inamed Corporation 
(``Inamed''), which is designed to remedy the anticompetitive effects 
of the proposed acquisition of Inamed by Allergan. Under the terms of 
the proposed Consent Agreement, the companies would be required to 
return the development and distribution rights to Reloxin[supreg], a 
botulinum toxin type A product, to Ipsen Ltd. (``Ipsen''), its 
manufacturer.
    The proposed Consent Agreement has been placed on the public record 
for thirty (30) days for receipt of comments by interested persons. 
Comments received during this period will become part of the public 
record. After thirty (30) days, the Commission will again review the 
proposed Consent Agreement and the comments received and will decide 
whether it should withdraw from the proposed Consent Agreement, modify 
it, or make final the Decision and Order (``Order'').
    Pursuant to an Agreement and Plan of Merger dated December 20, 
2005, Allergan proposes to acquire all of the outstanding common shares 
of Inamed in a transaction valued at approximately $3.2 billion 
(``Acquisition''). The Commission's complaint alleges that the proposed 
acquisition, if consummated, would violate Section 7 of the Clayton

[[Page 13129]]

Act, as amended, 15 U.S.C. 18, and Section 5 of the Federal Trade 
Commission Act, as amended, 15 U.S.C. 45, by eliminating the next most 
likely entrant in the market for cosmetic botulinum toxins. The 
proposed Consent Agreement would remedy the alleged loss of potential 
competition that would result from the merger in this market.
    Botulinum toxin is an increasingly popular, non-surgical treatment 
for wrinkles caused by repetitive muscle movement, such as the ``worry 
lines'' that appear on the forehead when a person frowns. Botulinum 
toxin is uniquely effective in temporarily eliminating these ``dynamic 
wrinkles'' because it is the only product that can paralyze the 
underlying muscles associated with these wrinkles. Although there are 
many products and procedures that can be used to treat facial wrinkles, 
such as dermal fillers, topical creams, lasers, chemical peels, and 
surgery, botulinum toxin therapy is sufficiently differentiated from 
these other products and procedures that they are not close economic 
substitutes.
    Allergan is the dominant supplier of cosmetic botulinum toxin in 
the United States. Allergan's Botox[supreg] is the only botulinum toxin 
type A approved by the U.S. Food and Drug Administration (``FDA'') for 
the treatment of facial wrinkles. In 2002, Ipsen granted Inamed the 
exclusive rights to develop and distribute a botulinum toxin type A 
product for facial cosmetic indications in the United States. 
Tentatively branded Reloxin[supreg], Inamed's cosmetic botulinum toxin 
product is currently in Phase III clinical trials and is expected to be 
the first serious challenger to Botox[supreg] in the United States. 
Other firms' cosmetic botulinum toxin development programs lag well 
behind Inamed's Reloxin[supreg] program.
    Entry into the market for cosmetic botulinum toxin would not be 
timely, likely, or sufficient in its magnitude, character, and scope to 
deter or counteract the anticompetitive effects of the Acquisition. 
Developing and obtaining FDA approval for manufacture and sale of 
cosmetic botulinum toxin takes at least two years due to substantial 
regulatory and technological barriers.
    According to the Commission's complaint, the proposed acquisition 
likely would cause significant anticompetitive harm to consumers in the 
U.S. market for cosmetic botulinum toxin by eliminating potential 
competition between Allergan and Inamed. The entry of Reloxin[supreg], 
which is expected to be the second botulinum toxin product to receive 
FDA approval for the treatment of facial wrinkles, would increase 
competition and likely reduce prices to consumers. Accordingly, 
allowing Allergan to control both Botox[supreg] and Reloxin[supreg] 
would likely force customers to pay higher prices for cosmetic 
botulinum toxin.
    The proposed Consent Agreement contains several provisions designed 
to ensure the successful and timely entry of Reloxin by requiring that: 
(1) Allergan and Inamed divest the Reloxin[supreg] development and 
distribution rights, including the ongoing clinical trials and certain 
intellectual property, back to Ipsen; (2) Allergan and Inamed take 
steps to ensure that confidential business information relating to 
Reloxin[supreg] will not be obtained or used by Allergan; and (3) Ipsen 
and/or its future marketing partner have the opportunity to enter into 
employment contracts with certain key individuals who have experience 
relating to Reloxin[supreg].
    The Commission has appointed Charles A. Riepenhoff, Jr. of KPMG LLG 
as Interim Monitor to oversee the transfer of confidential business 
information back to Ipsen and to ensure compliance with all of the 
provisions of the proposed consent order. Mr. Riepenhoff has over 
thirty-four years of experience in the health care industry. To ensure 
that the Commission remains informed about the status of the proposed 
assets and transfers of assets, the proposed Consent Agreement requires 
Allergan and Inamed to file reports with the Commission periodically 
until the divestitures and transfers are accomplished.
    The purpose of this analysis is to facilitate public comment on the 
Consent Agreement, and it is not intended to constitute an official 
interpretation of the Consent Agreement or to modify its terms in any 
way.

    By direction of the Commission, with Commissioner Rosch recused.
Donald S. Clark,
Secretary.
[FR Doc. E6-3550 Filed 3-13-06; 8:45 am]
BILLING CODE 6750-01-P