a. What provisions of the antitrust statutes did the pharmacies accuse the drug manufacturers of violating?
b. Have the manufacturers violated price-fixing prohibitions?
c. What is the moral of the story?
d. Have the drug companies violated the Robinson-Patman Act?
e. Make an argument that it does not lessen competition.
f. What was the outcome in this case?
g. Does this mean prices will be lower to consumers who buy at pharmacies?
h. Was there a fatal weakness in the manufacturers' case?
A group of 40,000 retail pharmacies sued the nation's drug manufacturers alleging that the drug manufacturers (1) fixed prices and (2) discriminated against pharmacies by charging them higher prices than health maintenance organizations. There was evidence that at meetings of the Pharmaceutical Manufacturers Association (an industry trade group) the manufacturers shared pricing information. The drug companies admitted they gave discounts to HMOs and not to pharmacies.