Iqvia's Proposed Propel Media Buy Would 'Harm Consumers,' Says FTC's TRO Complaint

Allowing health data firm Iqvia to complete its buy of digital advertising company Propel Media before issuance of a decision on the merits by the FTC through the administrative process “would harm consumers and undermine” the commission’s ability to remedy the anticompetitive effects of the proposed buy “if it is ultimately found unlawful,” said the FTC’s heavily redacted complaint Wednesday for a temporary restraining order (TRO) and preliminary injunction (docket 1:23-cv-06188) in U.S. District Court for Southern New York in Manhattan.

The FTC believes the proposed acquisition violates antitrust laws and asked the court to enter before 11:59 p.m. EDT Friday an order prohibiting defendants Iqvia and Propel Media from consummating the proposed acquisition until after the court rules on the FTC’s request for a preliminary injunction. The administrative proceeding on the merits of the proposed acquisition, scheduled to begin Dec. 20, will determine its legality and give all parties an opportunity to do discovery and present testimony and other evidence on the "likely anticompetitive" effects of the purchase, said the complaint.

Defendant Iqvia, the “self-described ‘market leader’ in healthcare data, seeks to extend its dominance into programmatic advertising to healthcare professionals (HCPs) through the proposed acquisition of DeepIntent, which Propel Media bought in 2017, said the FTC’s Wednesday 245-page memorandum of law in support of the TRO. The proposed Propel buy, which follows Iqvia’s buy of Lasso Marketing in July 2022, would give Iqvia control of two of the three leading healthcare demand-side platforms (DSPs) that deliver automated, programmatic, digital ads directly to U.S. HCPs via websites, mobile apps and smart TVs, said the memorandum.

Because Iqvia already controls the top healthcare data for running ad campaigns to HCPs, Iqvia would have the ability and incentive “to disadvantage current and potential rivals to DeepIntent and Lasso” after the acquisition, said the memorandum. It cited the “indicia of vertical harm" identified by the U.S. Supreme Court in Brown Shoe Co. v. U.S., saying Iqvia is “likely to disadvantage Lasso’s and DeepIntent’s competitors” post-acquisition. As a result, competition in the growing market “will be curtailed, and healthcare companies will be forced to pay more to market their products,” it said.

Through acquisitions of Lasso and DeepIntent, Iqvia seeks to control two healthcare DSPs that deliver programmatic ads to U.S. HCPs on a one-to-one basis, said the memorandum. Healthcare companies want to convey clinically meaningful information to HCPs through targeted ads to affect how they prescribe drugs, it said. An advertiser may want to highlight a cancer drug’s most recent clinical trial results to oncologists who have previously prescribed a competitor’s product, the FTC gave as an example.

Using HCP programmatic ads, healthcare companies can reach a range of individual providers across medical and nonmedical content publishers including WebMD, ESPN and Netflix, “determine when those providers engage with an advertisement, and assess whether those providers changed their prescribing behavior” -- abilities they don’t have with traditional advertising, the memorandum said.

Companies built healthcare DSPs because as verticals, they “meet a healthcare marketer’s complex needs,” said the memorandum, quoting the DeepIntent website. DeepIntent and Lasso “competed vigorously on price and innovation, often for the same customers,” it said. Iqvia has one of the largest collections of healthcare information in the world. Its annual report says the “actionable information we provide is not comprehensively available from any other source and our scope of information would be difficult and costly for another party to replicate.”

Iqvia is the preeminent provider of HCP identity data that’s used to identify HCPs, having bought MedData Group and DMD Marketing, and it’s also the leading source of HCP prescribing data, said the memorandum. HCP prescribing data is used to both plan an ad campaign and measure its effectiveness, and it allows advertisers to measure if the HCPs they targeted increased prescriptions of the advertised drug, it said. Through its control of key information sources, Iqvia “thus possesses the ability to disadvantage existing competitors to DeepIntent and Lasso and stifle entry from others,” it said. Iqvia is “uniquely positioned to affect the success (or failure) of healthcare DSPs, and will possess a strong incentive to protect its leading market position” following the Propel buy, it said.

Iqvia and Propel, in a Wednesday memorandum of law in opposition to the FTC’s motion for a TRO, said they're willing to stipulate a TRO of “reasonable duration” -- until Nov. 15 or after the motion for a preliminary injunction is decided -- to give the parties and the court time to develop the record, litigate the FTC’s claims and ensure the agency “works expeditiously” to resolve the case, it said.

The memorandum, with the date on which Iqvia and DeepIntent entered into the proposed transaction redacted, noted the FTC “baldly” pronounced it's likely to succeed on the merits of its ultimate claim. “But as in the other recent merger challenges the FTC has pursued and lost, the FTC has not substantiated its allegations with evidence or law,” it said.

The FTC asked for an immediate TRO that wouldn't expire until 10 days after the resolution of “an as-of-yet unfiled motion for preliminary injunction in a case where there is no schedule,” said defendants’ memorandum. The commission hasn't informed the court when it will file its motion nor on what schedule it will seek or agree to have the motion resolved, it said. In discussions with defendants, the FTC “has been unwilling to commit to a schedule calculated to a reach a decision before the end of November,” the memorandum said. “Defendants cannot agree to the unbounded TRO that the FTC has requested” and asked the court to deny the FTC’s motion.