FTC seeks input on pet meds industry


Early next month, the Federal Trade Commission (FTC) will host a workshop to examine how pet medications are distributed to pet owners and how these practices affect consumer choice and price competition. In advance of that event, to be held Oct. 2 in Washington, D.C., the commission is soliciting input from key stakeholders, including veterinarians, pet owners, business representatives, economists, lawyers, academics and any other interested parties.

“American consumers spend a tremendous amount of money on medications for their pets every year,” says FTC Chairman Jon Leibowitz. “High prices on these medications mean that consumers have less money for necessities. It’s important that these medications are safe and effective and that pet owners get the benefits of a fair and robust marketplace. This workshop will help us understand these and other issues related to the medications we buy for our pets to keep them healthy.”

FTC officials say the workshop will examine these questions, among others:

• How are pet medications distributed to consumers?
• What are the business rationales for various pet medication distribution practices?
• How do these practices affect prices to consumers?
• How do these practices affect product supply and quality?
• How do these practices affect entry into the pet medications industry?
• What product safety issues exist with respect to these practices?
• Are there other factors that should be considered when analyzing the competition and consumer protection issues related to the distribution of pet medications?


Among the primary issues the workshop will address is how readily pet owners are able to obtain written, portable prescriptions they can fill where they choose and their ability to verify the safety and efficacy of the medications they purchase. The FTC points to the contact lens industry as a parallel, stating on its website that the workshop will “examine the extent to which recent changes ... in the contact lens industry might yield lessons applicable to the pet medications industry.” In 2003 Congress passed the Fairness to Contact Lens Consumers Act, which mandated that optometrists and opticians provide their patients with prescriptions for contact lenses to fill wherever they wanted.

The workshop will also examine the implications of HR 1406, the Fairness to Pet Owners Act, which would require veterinarians to provide their clients with written prescriptions for pet medications (whether the client requests it or not) and forbid them from charging a prescription-writing fee or asking clients to sign a waiver of liability. The bill would require the FTC to create rules for implementation within six months after it’s enacted, if it passes. At this time, the bill, sponsored by Rep. Jim Matheson, D-Utah, is still pending in committee.

In a notice posted in the Federal Register July 9, the FTC describes the increase over the past 10 years in nonveterinary sources of pet medications, including brick-and-mortar and online retail and pharmacy entities, as an overall positive development for pet owners. “Some evidence suggests that these retailers may offer substantial pro-consumer benefits, such as increased convenience and lower prices,” the notice states.

The FTC does note product reliability and safety issues, however, especially in cases of product diversion, saying that some experts “have questioned whether secondary suppliers and retailers always receive bona fide products (as compared to, for example, counterfeit product from non-U.S. sources), thereby raising potential questions about product safety and authenticity.” Workshop participants will discuss these safety and reliability issues during the event.

Another issue the workshop intends to explore is the disagreement over who is qualified to dispense pet medications and instruct pet owners regarding administration. “Some observers argue that veterinarians are in the best position to carry out these responsibilities,” the FTC says in its notice. “Others argue that licensed pharmacists are equally capable of dispensing pet medications to consumers, provided the pharmacists dispense the correct medication and dosage as prescribed by a veterinarian.”

And while the FTC acknowledges the stance of the American Veterinary Medical Association that veterinarians should honor clients’ requests for prescriptions, it states that the guidance is not mandatory—or even consistently adhered to. “It appears that, while many veterinarians provide written prescriptions to their clients when requested, some veterinarians have refused to provide prescriptions or otherwise have discouraged their clients from obtaining pet medications from retailers,” the notice states.

Bottom line? While the FTC wants to hear from veterinarians, ultimately it’s all about the consumer—in this case, the pet owner. “The goal of the workshop is to educate consumers about the choices that are available to them when purchasing pet medications,” says Stephanie Wilkinson, an attorney with the FTC’s Office of Policy Planning. “The FTC will examine whether competition in this marketplace may be further developed in ways that benefit consumers, including lower prices, enhanced choice and improved product safety.”

The workshop is free and open to the public, and preregistration is not required. It will be held at the FTC’s satellite conference center at 601 New Jersey Ave., NW, Washington, D.C. The FTC’s Federal Register notice can be found at ftc.gov/os/2012/06/120629petmedswkspfrn.pdf.

Comments can be submitted in paper or electronic format through September 14, with full instructions available in the Federal Register notice. Comments can be submitted electronically by visiting ftcpublic.commentworks.com/ftc/petmedsworkshop. Written comments should be mailed or delivered to: Federal Trade Commission, Office of the Secretary, Room H-113 (Annex X), 600 Pennsylvania Ave., NW, Washington, DC 20580.
 


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