Being the big kid on the hospital floor has its advantages. One can wink and nod about offering the purchasing guy a discount on one item, so long as another is bought as well. This is called bundling. Such tactics are illegal, of course, but that’s what Conmed accused J&J’s Ethicon unit of doing.

The device maker agreed to accept a modest $11 million to settle a 2003 lawsuit accusing Ethicon of antitrust for elbowing it out of hospitals. The J&J unit allegedly offered deals for sutures, but only if hospitals and group purchaser bought its endoscopy devices.

Originally, the lawsuit, which was about to go to trial, sought $1.8 billion in damages, which could have been tripled. “It’s important for us to get this behind us and to focus on running the business,” Daniel Jonas, Conmed’s general counsel, tells Bloomberg News. “It’s a good result for us today.”

Certainly, it’s good for J&J. The company rang up $53 billion in sales last year, with $20 billion coming from medical devices. Do the math and the $11 million payment works out to much less than 1 percent of device sales.

No wonder a J&J spokesman, who notes the company denies any liability, was crowing the payment is “significantly less” than what Conmed sought. Maybe it pays to be a bully.

Further reading….
Bloomberg News;
Conmed’s SEC filing about the settlement;
J&J annual report, see Page 73.