Arizona Institute of Reproductive Medicine, Ltd., et al.; Proposed Consent Agreement With Analysis to Aid Public Comment

FEDERAL TRADE COMMISSION

[File No. 942-3134]

Arizona Institute of Reproductive Medicine, Ltd., et al.;

Proposed Consent Agreement With Analysis to Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement.

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SUMMARY: In settlement of alleged violations of federal law prohibiting

unfair acts and practices and unfair methods of competition, this

consent agreement, accepted subject to final Commission approval, would

prohibit, among other things, a Phoenix, Arizona based company and its

president from misrepresenting the success rate of their in vitro

fertilization program or any other infertility treatment services. In

addition, it would require the institute and its president to possess

competent and reliable scientific evidence for any future comparative

success-rate claims for fertility services.

DATES: Comments must be received on or before September 1, 1995.

ADDRESSES: Comments should be directed to: FTC/Office of the Secretary,

Room 159, 6th St. and Pa. Ave., NW., Washington DC 20580.

FOR FURTHER INFORMATION CONTACT: Michael Katz or Matthew Daynard, FTC/

H-200, Washington, DC 20580. (202) 326-3123 or (202) 326-3291.

SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal

Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46 and Sec. 2.34 of the

Commission's rules of practice (16 CFR 2.34), notice is hereby given

that the following consent agreement containing a consent order to

cease and desist, having been filed with and accepted, subject to final

approval, by the Commission, has been placed on the public record for a

period of sixty (60) days. Public comment is invited. Such comments or

views will be considered by the Commission and will be available for

inspection and copying at its principal office in accordance with

Sec. 4.9(b)(6)(ii) of the Commission's rules of practice (16 CFR

4.9(b)(6)(ii)).

Agreement Containing Consent Order to Cease and Desist

In the Matter of: Arizona Institute of Reproductive Medicine, Ltd.,

a limited corporation, and Robert H. Tamis, M.D., individually and as

president of said corporation. [File No. 942-3134].

The Federal Trade Commission having initiated an investigation of

certain acts and practices of Arizona Institute of Reproductive

Medicine, Ltd., a limited corporation, and Robert

[[Page 34536]]

H. Tamis, M.D., individually and as president of said corporation,

hereinafter sometimes referred to as proposed respondents or

respondents, and it now appearing that proposed respondents are willing

to enter into an agreement containing an order to cease and desist from

the use of the acts and practices being investigated,

It is hereby agreed by and between proposed respondents and counsel

for the Federal Trade Commission that:

1. Proposed respondent Arizona Institute of Reproductive Medicine,

Ltd., is a limited corporation existing and doing business under and by

virtue of the laws of the State of Arizona, with its office and

principal place of business located at 2850 North 24th Street, Suite

500-A, Phoenix, Arizona 85008.

Proposed respondent Robert H. Tamis, M.D., is president of

respondent Arizona Institute of Reproductive Medicine. His principal

office or place of business is the same as that of the corporate

respondent. Dr. Tamis formulates, directs and controls the acts and

practices of said corporation.

2. Proposed respondents admit all the jurisdictional facts set

forth in the draft complaint.

3. Proposed respondents waive:

(a) Any further procedural steps;

(b) The requirement that the Commission's decision contain a

statement of findings of fact and conclusions of law;

(c) All rights to seek judicial review or otherwise to challenge or

contest the validity of the order entered pursuant to this agreement;

and

(d) Any claim under the Equal Access to Justice Act, 5 U.S.C. 504.

4. This agreement shall not become part of the public record of the

proceeding unless and until it is accepted by the Commission. If this

agreement is accepted by the Commission, it, together with the draft

complaint, will be placed on the public record for a period of sixty

(60) days and information in respect thereto publicly released. The

Commission thereafter may either withdraw its acceptance of this

agreement and so notify the proposed respondents, in which event it

will take such action as it may consider appropriate, or issue and

serve its complaint (in such form as the circumstances may require) and

decision, in disposition of the proceeding.

5. This agreement is for settlement purposes only and does not

constitute an admission by proposed respondents of facts, other than

the jurisdictional facts, or of violations of law as alleged in the

draft of complaint.

6. This agreement contemplates that, if it is accepted by the

Commission, and if such acceptance is not subsequently withdrawn by the

Commission pursuant to the provisions of Sec. 2.34 of the Commission's

rules, the Commission may, without further notice to proposed

respondents: (a) issue its complaint corresponding in form and

substance with the draft complaint and its decision containing the

following order to cease and desist in disposition of the proceeding;

and (b) make information public in respect thereto. When so entered,

the order to cease and desist shall have the same force and effect and

may be altered, modified or set aside in the same manner and within the

same time provided by statute for other orders. the order shall become

final upon service. Delivery by the U.S. Postal Service of the

complaint and decision containing the agreed-to-order to proposed

respondents' address as stated in this agreement shall constitute

service. Proposed respondents waive any right they may have to any

other manner of service. The complaint may be used in construing the

terms of the order, and no agreement, understanding, representation, or

interpretation not contained in the order or the agreement may be used

to vary or contradict the terms of the order.

7. Proposed respondent have read the draft complaint and the

following order. Proposed respondents understand that once the order

has been issued, they will be required to file one or more compliance

reports showing that they have fully complied with the order. Proposed

respondents further understand that the may be liable for civil

penalties in the amount provided by law for each violation of the order

after it becomes final.

Order

Definitions

``Competent and reliable scientific evidence'' shall mean those

tests, analyses, research, studies or other evidence based on the

expertise of professionals in the relevant area, that have been

conducted and evaluated in an objective manner by persons qualified to

do so, using procedures generally accepted in the profession to yield

accurate and reliable results.

I

It is ordered that respondents Arizona Institute of Reproductive

Medicine, Ltd., a limited corporation, and Robert H. Tamis, M.D.,

individually and as president of said corporation, their successors and

assigns, officers, agents, representatives, and employees, directly or

through any corporation, subsidiary, division, or other device, in

connection with the advertising, promotion, sale or offering for sale

of services relating to the treatment of infertility, do forthwith

cease and desist from representing, directly or by implication, that

respondents' success rates in terms of achieving deliveries is higher

than or compares favorably with the success rates of any single

provider or group of providers of these services, unless at the time of

making such a representation, respondents possess and rely upon

competent and reliable scientific evidence for making such a comparison

which shall, at a minimum, consist of results for its own patients that

are based upon the same criteria for determining the calculation of

delivery rates that were used to produce the results with which the

comparison is made, or otherwise misrepresenting the past or present

success of respondents in achieving live births or pregnancies or the

past or present success of any single provider or group of providers of

these services in achieving live births or pregnancies.

II

It is further ordered that respondents, shall forthwith distribute

a copy of this Order to each of their officers, agents,

representatives, and employees, who are engaged in the preparation and

placement of advertisements or promotional materials, who communicated

with patients or prospective patients, or who have any responsibilities

with respect to the subject matter of this Order; and for a period of

ten (10) years from the date of entry of this Order, distribute same to

all of respondents' future officers, agents, representatives, and

employees having said responsibilities.

III

It is further ordered that for five (5) years after the last date

of dissemination of any representation covered by this Order,

respondents, or their successors and assigns, shall maintain and upon

request make available to the Federal Trade Commission for inspection

and copying:

A. All materials that were relied upon in disseminating such

representation; and

b. All tests, reports, studies, surveys, demonstrations or other

evidence in their possession or control that contradict, qualify, or

call into question such representation, or the basis relied upon for

such representation, including complaints from consumers.

[[Page 34537]]

IV

It is further ordered that:

(1) Respondent Arizona Institute of Reproductive Medicine, Ltd.

Shall notify the Commission at least thirty (30) days prior to any

proposed change in respondent such as dissolution, assignment or sale

resulting in the emergence of a successor corporation, the creation or

dissolution of subsidiaries or any other change in respondent which may

affect compliance obligations arising out of this Order; and

(2) Respondent Robert H. Tamis, M.D. shall promptly notify the

Commission of the discontinuance of his present business or of his

affiliation with the corporate respondent. In addition, for a period of

three (3) years from the date of service of this Order, the respondent

shall promptly notify the Commission of each affiliation with a new

business or employment that involves an infertility program. Each such

notice shall include the respondent's new business address and a

statement of the nature of the business or employment in which the

respondent is newly engaged as well as a description of respondent's

duties and responsibilities in connection with the business or

employment.

The expiration of the notice provision of this paragraph shall not

affect any other obligation arising under this Order.

V

It is further ordered that respondents shall, within (60) days

after service of this Order, file with the Commission a report, in

writing, setting forth in detail the manner and form in which they have

complied with all requirements of this Order.

Analysis of Proposed Consent Order To Aid Public Comment

The Federal Trade Commission has accepted an agreement to a

proposed consent order from the Arizona Institute of Reproductive

Medicine, Ltd. and its President, Robert H. Tamis, M.D. The Arizona

Institute of Reproductive Medicine offers infertility services to the

public, including in vitro fertilization.

The proposed consent order has been placed on the public record for

sixty (60) days for reception of comments by interested persons.

Comments received during this period will become part of the public

record. After sixty (60) days, the Commission will again review the

agreement and the comments received and will decide whether it should

withdraw from the agreement or make final the agreement's proposed

order.

The Commission has alleged that proposed respondents failed to

possess a reasonable basis for claims they made regarding their

comparative success in achieving live births for their patients. The

Arizona Institute of Reproductive Medicine claimed a live birth per

embryo transfer rate of 17 percent in 1991 and 16 percent for the first

six months of 1992, as compared to a national average of 14 percent for

1991.

The Commission alleges that these claims were deceptive because the

Arizona Institute of Reproductive Medicine calculated the success

statistics in their promotional materials counting multiple births

(i.e., twins, triplets, etc.) as multiple deliveries. The national

percentage was based on data published by The Society for Assisted

Reproductive Technology (``SART''), a national organization whose

members, including proposed respondents, are providers of assisted

reproductive technologies. SART publishes annually national averages

for live births achieved through its members' services. National

averages for live births are based on a protocol which requires members

to report multiple births as single deliveries. The published report

counts a multiple birth as a single delivery. Had proposed respondents

likewise counted multiple births as a single delivery, their success

statistics for deliveries would have been significantly lower than both

the true national average for deliveries per embryo transfer, which was

17 percent for 1991, and the 14 percent represented by respondents.

Part I of the proposed consent order seeks to address the alleged

misrepresentation cited in the accompanying complaint by requiring

proposed respondents to possess competent and reliable scientific

evidence for any future success rate comparative claims for their

infertility procedures. Any comparison with other success rates must

consist of results that are based upon the same or essentially

equivalent tests that were used as a basis for the other rates.

Moreover, a fencing-in provision prohibits any misrepresentation of

success in achieving pregnancies or live births by respondents as well

as prohibiting respondents from misrepresenting the success rates of

any single provider or group of providers of these services.

The purpose of this analysis is to facilitate public comment on the

proposed order, and it is not intended to constitute an official

interpretation of the agreement and proposed order or to modify in any

way their terms.

Donald S. Clark,

Secretary.

[FR Doc. 95-16255 Filed 6-30-95; 8:45 am]

BILLING CODE 6750-01-M