Antitrust Lawsuit Filed Against Medtronic for Dominating Surgical Device Market

Applied Medical Resources has accused Medtronic of using its market dominance to suppress competition in the US market for advanced bipolar devices, which are used to cut tissue and seal blood vessels. Applied Medical filed an antitrust complaint in Central California’s U.S. District Court, alleging that Medtronic has a 78% share of the advanced bipolar device market with its Ligasure device and is using bundling agreements with hospitals and healthcare group purchasing organizations to prevent competition.

Applied Medical claims that the bundling agreements have cost the company millions of dollars in potential sales and brand goodwill. The company also said that its Voyant intelligent energy system, which costs 15-20% less than competing advanced bipolar devices, is being shut out by hospitals that have signed the bundling agreements.

While Applied Medical has only a 3% share of the advanced bipolar devices market in the US, it has a 50% share in some European countries, where bundling practices are more regulated. Medtronic, which acquired Covidien in 2015, reported nearly $32 billion in revenue and 95,000 employees during its most recent fiscal year, while Applied Medical has more than $800 million in annual revenue and 5,400 employees. Medtronic denied the allegations and said it will defend itself against the lawsuit.