`BEFORE THE FEDERAL TRADE COMMISSION
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`Joseph J. Simons, Chairman
`COMMISSIONERS:
`Noah Joshua Phillips
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`Rohit Chopra
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`Rebecca Kelly Slaughter
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`Christine S. Wilson
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`In the Matter of
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`Stryker Corporation,
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`a corporation;
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`and
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`Wright Medical Group N.V.,
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`a corporation.
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`201 0014
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`DOCKET NO. C-4728
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`COMPLAINT
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`Pursuant to the Clayton Act and the Federal Trade Commission Act (“FTC Act”), and its
`authority thereunder, the Federal Trade Commission (“Commission”), having reason to believe
`that Respondent Stryker Corporation (“Stryker”), a corporation subject to the jurisdiction of the
`Commission, has made an offer to acquire all of the voting securities of Wright Medical Group
`N.V., Inc. (“Wright”), a company subject to the jurisdiction of the Commission, in violation of
`Section 5 of the FTC Act, as amended, 15 U.S.C. § 45, and that such acquisition, if
`consummated, would violate Section 7 of the Clayton Act, as amended, 15 U.S.C. § 18, and
`Section 5 of the FTC Act, as amended, 15 U.S.C. § 45, and it appearing to the Commission that a
`proceeding in respect thereof would be in the public interest, hereby issues its Complaint, stating
`its charges as follows:
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`I. RESPONDENT
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`1. Respondent Stryker is a corporation organized, existing, and doing business under,
`and by virtue of the laws of, the state of Michigan with its executive offices and
`principal place of business located at 2825 Airview Boulevard, Kalamazoo, Michigan
`49002. Stryker is engaged in the development, manufacture, sale, and distribution of
`medical devices used in a broad range of medical specialties.
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`2. Respondent Stryker is, and at all times relevant herein has been, engaged in
`commerce, as “commerce” is defined in Section 1 of the Clayton Act as amended, 5
`U.S.C. § 12, and is a company whose business is in or affects commerce, as
`“commerce” is defined in Section 4 of the FTC Act, as amended, 15 U.S.C. § 44.
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`II. THE ACQUIRED COMPANY
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`3. Respondent Wright is a corporation organized, existing, and doing business under,
`and by virtue of, the laws of The Netherlands with its principal place of business
`located at Prins Bernhardplein 200, Amsterdam, The Netherlands, 1097 JB and its
`United States address for service of process is Michael McFalls, Ropes & Gray, 2099
`Pennsylvania Avenue, NW, Washington, D.C. 20006. Wright is engaged in the
`development, manufacture, sale, and distribution of medical devices used in a broad
`range of medical specialties.
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`4. Respondent Wright is, and at all times relevant herein has been, engaged in
`commerce, as “commerce” is defined in Section 1 of the Clayton Act as amended, 15
`U.S.C. § 12, and is a company whose business is in or affects commerce, as
`“commerce” is defined in Section 4 of the FTC Act, as amended, 15 U.S.C. § 44.
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`III. THE PROPOSED ACQUISITION
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`5. Pursuant to a Purchase Agreement dated November 4, 2019, Stryker agreed to acquire
`all of the voting securities of Wright (the “Acquisition”). The Acquisition is subject
`to Section 7 of the Clayton Act, as amended, 15 U.S.C. § 18.
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`IV. THE RELEVANT MARKET
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`6. The relevant lines of commerce in which to analyze the effects of the Acquisition are
`the development, manufacture, license, marketing, distribution, and sale of the
`following reconstructive joint implants: (1) total ankle replacements and (2) finger
`joint arthroplasty implants.
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`7. The United States is the relevant geographic area in which to assess the competitive
`effects of the Acquisition in the relevant lines of commerce.
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`V. THE STRUCTURE OF THE MARKET
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`8. Total ankle replacements are used to treat end-stage ankle arthritis, which typically
`develops when cartilage on the bones of the ankle joint wears away and causes bone-
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`on-bone grinding. The U.S. market for total ankle replacements is highly
`concentrated. Wright and Stryker are the first and third largest suppliers,
`respectively, of total ankle replacements, while Integra LifeSciences (“Integra”) is the
`second-largest supplier. Exactech, Inc. and Zimmer Biomet also supply total ankle
`replacement products, but have only small shares of the market. Together, a
`combined Stryker and Wright would account for approximately 75% of the total U.S.
`ankle replacement market.
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`9. Finger joint arthroplasty implants are used to treat advanced osteoarthritis and are
`implanted into a patient’s proximal interphalangeal joints or metacarpophalangeal
`joints through a surgical procedure to replace damaged bone and cartilage. The U.S.
`market for finger joint arthroplasty implants is highly concentrated. Stryker and
`Wright are two of only three significant suppliers for finger joint arthroplasty
`implants. Integra is the leading supplier while Stryker and Wright are the second and
`third largest suppliers, respectively. BioPro Implants (“BioPro”) is the only other
`supplier of finger joint arthroplasty implants in the United States, but has a very small
`share of the market. The combined Stryker and Wright would have a finger joint
`arthroplasty implant market share in the United States in excess of 50%.
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`VI. ENTRY CONDITIONS
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`10. Entry into the relevant markets described in Paragraphs 6 and 7 would not be likely or
`sufficient in magnitude, character, and scope to deter or counteract the expected
`anticompetitive effects of the Acquisition. De novo entry would not take place in a
`timely manner because product development times, U.S. Food and Drug
`Administration approval requirements, and market adoption times are lengthy. A
`potential entrant into the relevant markets would also need to develop a reputation for
`consistent quality and service before surgeons would substitute them for currently
`marketed devices.
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`VII. EFFECTS OF THE ACQUISITION
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`11. The effects of the Acquisition, if consummated, may be to substantially lessen
`competition and to tend to create a monopoly in the relevant markets in violation of
`Section 7 of the Clayton Act, as amended, 15 U.S.C. § 18, and Section 5 of the FTC
`Act, as amended, 15 U.S.C. § 45, by eliminating actual, direct, and substantial
`competition between Stryker and Wright in the markets for total ankle replacements
`and finger joint arthroplasty implants, thereby increasing the likelihood in these
`markets that: (1) a combined Stryker-Wright would be able to unilaterally exercise
`market power; (2) research and development would be reduced; and (3) customers
`would be forced to pay higher prices.
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`VIII. VIOLATIONS CHARGED
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`12. The Acquisition described in Paragraph 5, if consummated, would constitute a
`violation of Section 7 of the Clayton Act, as amended, 15 U.S.C. § 18, and Section 5
`of the FTC Act, as amended, 15 U.S.C. § 45.
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`WHEREFORE, THE PREMISES CONSIDERED, the Federal Trade
`Commission on this third day of November, 2020 issues its Complaint against said Respondent.
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`By the Commission.
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`SEAL:
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`April J. Tabor
`Acting Secretary
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