FTC takes new step toward blocking Novant's endoscopy center acquisition

The Federal Trade Commission has filed a preliminary injunction request to bar Charlotte, N.C.-based Novant Health from purchasing two medical centers owned by Franklin, Tenn.-based Community Health Systems, according to an April 8 report from the Triad Business Journal.

The FTC first sued Novant to block the $320 million acquisition of Mooresville, N.C.-based Lake Norman Regional Medical Center and Statesville, N.C.-based Davis Regional Medical Center in January. 

The FTC argues that the acquisition would "irreversibly consolidate the market for hospital services" in the area, as Novant would hold "an eye-popping 64% share of the market."

A hearing on the lawsuit has been set for June 26, but if the injunction is granted, the finalization of the acquisition would be put on hold until the FTC determines if the merger meets antitrust law standards. 

Novant and CHS originally struck the deal in February 2023, which includes the medical centers, majority interest in a Mooresville endoscopy center and an entity holding a certificate of need to build an ASC in Mooresville.

"The FTC's attempt to prevent this transaction is misguided and inaccurate – both on the facts and the law," Novant Health said in a statement to the Journal. "Our commitment to purchase is, fundamentally, a commitment to restore services lost over time and to provide new, leading-edge technology that will enhance the clinical capabilities available to the greater Charlotte community."

It also said it would "pursue available legal responses to the FTC's flawed position."

In its request for an injunction, the FTC cited former cases in which the court held that mergers are unlawful if they result in one entity controlling more than 30% of a market.

The FTC also noted that Lake Norman Medical Center is  just 12 miles away from Novant Health Huntersville (N.C.) Medical Center, and the hospitals already "compete aggressively."

The FTC argues that the current competition is a benefit to patients, as it lowers prices and improves quality of care and new service offerings. 

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