Price-Fixing Alleged in Human Eggs

SAN FRANCISCO (CN) - An antitrust class action accuses the American Society for Reproductive Medicine and the Society for Assisted Reproductive Technology of fixing the price of human eggs for more than a decade, to profit unfairly from the $80 million a year market. Lead plaintiff Justine Levy says the Society for Assisted Reproductive Technology has more than 393 member clinics, which account for more than 85 percent of the assisted reproductive technology clinics in the United States.

Levy complains, among other things, that egg donors, who suffer through lengthy, painful and potentially dangerous surgical procedures, are paid the same hourly rates as sperm donors - whose procedures are neither lengthy, painful, nor dangerous.

According to the federal complaint: "Defendants have been engaging in illegal price fixing in the reproductive technology market since 2000 when ASRM promulgated rules establishing the maximum compensation its members should pay for egg donor services. SART then agreed to adopt the newly developed maximum price rules for its members.

"Defendants established the maximum price rules in an effort to keep egg donor compensation artificially low and to retain more revenue for themselves and the fertility clinics and egg donor agencies that make up the defendant class. ...

"The egg donor services market involves sales of approximately $80 million annually."

In her case, Levy says she "sold egg donor services directly to Seattle Reproductive Medicine, a fertility clinic and egg donor agency with 13 physicians, of whom 12 are members of ASRM. Levy's compensation was artificially low as a result of defendants' price fixing."

She estimates the class of all women who sold human eggs for assisted reproduction over the past 4 years to number in the tens of thousands.

Levy says donors are grossly underpaid for submitting to a painful egg retrieval process, which may produce complications that include bleeding, reactions to hormones and liver failure.

"The majority of egg donations are made by women who are compensated for their services," Levy says. "Payment is necessary to provide incentive for egg donors to go through the long and painful process of providing eggs. Most donors are recruited with the promise of compensation for the egg donor services including the time, efforts, discomfort, and health risks resulting from the medical procedures involved."

The alleged basis for the payment rates is grossly unfair, Levy says, as they nonsensically try to make egg donation equivalent to sperm donation.

"Defendants originally determined the maximum prices rules for egg donor services based on the typical hourly rates paid to men donating sperm. The maximum price rules do not take into account the time, discomfort, health risks or possibility of future medical complications that come with donating human eggs. Nor do they take into account any adjustment for cost of living changes within the past eleven years," the complaint states.

Levy estimates the average hourly rate for egg donors is $75 to $93, about the same as hourly rates for sperm donors.

ASRM established a cap on payments for egg donor services in 2000, Levy says.

"ASRM has long been concerned about the prices paid to egg providers for human egg donation services, and has promulgated ethical guidelines concerning such payments since at least 1994.

"Prior to 2000, ASRM's standards of practice merely stated that compensation for human egg donation services 'should not be so excessive as to constitute undue inducement' but neither organization had established a specific maximum price."

The 2000 price rules required justification for compensation over $5,000 and set the maximum rate at $10,000. ASRM confirmed its price caps in guidelines issued between 2002 and 2008, according to the complaint.

Levy says the "defendants ASRM and SART disguise their price fixing agreements as ethical guidelines. However, the maximum price rules set by defendants are not merely ethical guidelines, but strict rules that must be followed as a condition of membership. To become a SART member fertility clinic, the clinic must agree to abide by defendants' maximum price rules. Similarly, members of ASRM must agree to 'adhere to the objectives of the Society.'"

Levy says that "ASRM members have been required to adhere to the maximum compensation rules for egg donor services as a condition of membership since the initial promulgation of the Maximum Price Report in 2000."

She says that independent egg donor agencies serving SART clinics have adopted the maximum price rules, to increase their customer base.

The complaint states: "ASRM and SART member fertility clinics and egg donation agencies serving ASRM and SART member clinics have successfully suppressed the price for egg donor services to prices within the range set by the ASRM's maximum price rules.

"A survey performed in 2007 for SART reported that SART member fertility clinics paid an average of $4,217 for egg donor services per donor cycle, while egg donor agencies serving SART member fertility clinics paid an average of $5,200 per cycle."

Levy calls this an antitrust violation.

"This naked price fixing of egg donor compensation is so unusual in the modern United States regulatory environment of unrestrained competition that the most intriguing question it raises is not whether it violates the Sherman Act - under existing precedent it does. Rather, the relevant question is how, given the government's substantial enforcement resources and the presence of an active and entrepreneurial plaintiffs' bar, this buyers' cartel has managed to survive unchallenged since at least 2000."

She adds: "By collectively agreeing to maintain artificially low prices for donor eggs, defendant clinics have been able to reap anti-competitive profits for themselves. Plaintiff and the members of the plaintiff class have been injured by the absence of a competitive market for the supply of donor eggs because they have been paid less for egg donor services than they would have been paid absent the ASRM maximum price rules."

Levy seeks class certification, damages for antitrust violations, and wants the defendants enjoined from fixing human egg prices.

She is represented by Timothy Fisher with Bursor & Fisher of Walnut Creek.

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