Casting Some Light on Shadow Pricing
Nicodemo Fiorentino, Esq.
Prescription drug prices continue to rise and focus attention on the pharmaceutical industry. Currently the industry faces hearings at the federal level, new legislation at the state level and almost daily media coverage due to this issue. The Sherman Antitrust Act, passed in 1890, is also being used against the industry. Often overlooked, “shadow pricing” and “conscious parallelism” are two ways in which manufacturers allegedly can restrain trade and competition. This article is aimed at helping compliance and legal professionals become familiar with antitrust and how it presents a present and future compliance risk. The article further represents a call for compliance and legal professionals to be involved with how their company sets pricing.