Summary
IDEXX Laboratories, Inc. (IDXX) has filed an 8-K report detailing a significant development regarding an investigation by the U.S. Federal Trade Commission (FTC). The company entered into an Agreement Containing Consent Order to Cease and Desist (Consent Agreement) on December 5, 2012, to resolve FTC concerns about alleged unfair methods of competition related to exclusive distribution agreements for companion animal veterinary products and services. The key outcome of this agreement, once finalized, is a ten-year restriction preventing IDEXX from having exclusive distribution agreements with all three major distributors: MWI Veterinary Supply, Inc., Butler Schein Animal Health, and Webster Veterinary. The company will be permitted to have exclusive agreements with a maximum of two of these distributors. To ensure compliance during the FTC's approval process, IDEXX has already modified its distribution agreement with MWI, effective January 1, 2013, to be non-exclusive.
Key Highlights
- 1IDEXX Laboratories entered into a Consent Agreement with the FTC to resolve an antitrust investigation.
- 2The investigation focused on alleged unfair competition related to exclusive distribution agreements.
- 3The Consent Agreement will limit IDEXX to exclusive distribution agreements with a maximum of two out of three specified distributors (MWI, Butler Schein, Webster).
- 4The agreement has a ten-year duration upon finalization.
- 5IDEXX modified its agreement with MWI Veterinary Supply, effective January 1, 2013, to be non-exclusive, ensuring interim compliance.
- 6The agreement is for settlement purposes and IDEXX maintains its belief that its practices do not violate antitrust laws.
- 7The Consent Agreement requires approval by the FTC Commissioners and a subsequent 30-day public comment period before becoming final.