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  "documentTitle": "TransMedics (TMDX)",
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  "authorName": "Scorpion Capital",
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  "presentationDate": "2025-01-10 00:00:00",
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  "notes": "The slide uses a combination of legal theory and qualitative expert testimony to build a case for anticompetitive behavior.",
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      "kind": "callout",
      "text": "Extortion occurs through the practice of “coercive tying” where the buyer is compelled to accept the tied service to accept the tying product, leading to higher costs and less choice.",
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      "text": "consumable cost: $110,000-120,000",
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      "text": "The statutory framework is well-established by the Sherman Act, Clayton Act, and the Federal Trade Commission Act; as well as in key case law that defines illegal tying and bundling such as International Salt, Jefferson Parish, and Eastman Kodak. Extortion occurs through the practice of “coercive tying” where the buyer is compelled to accept the tied service to accept the tying product, leading to higher costs and less choice. Thus, coercion and pricing are both central elements in anticompetition law. As a basic fact to gauge whether the pricing is extortion, we note that devices for kidneys cost $2,000 vs. TransMedics pumps at $70,000-$90,000 per consumable. Centers indicated that $110,000- $120,000 is the floor when the consumable is bundled with the NOP service, prior to including the Organ Procurement Organization’s charge of $50,000 to $70,000.",
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      "text": "Kidney perfusion pumps are a small fraction of TransMedics price. We have a cold perfusion pump for kidneys. They cost less than $2,000 each so that just gets absorbed into the OPO cost, but it's $2,000.",
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      "text": "Floor is $110,000 to $120,000 prior to OPO organ acquisition fee. The bills from TransMedics could be $110,000-120,000, and that's in addition to the transplant center's organ acquisition fee that they're getting from the OPO, which in itself is $50,000 to $70,000. So, if you include the OPO's fee for the organ, think of it like buying a car, and TransMedics is the transport company for that car, the total cost out the door could be approaching $150,000-200,000 and the profit margin for a lot of the payors that we deal with is only about $300,000. So, you could be eroding a significant amount of your profit at the transplant center if you were using their NOP program soup-to-nuts.",
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      "text": "Over $100,000 with the NOP. A: The NOP, when it first came out, was described as $30,000 for the surgeon and the technician, and then you had to pay for the transportation of the organ. That was on top of the device cost. We were looking at the cost of an organ on the NOP of over $100,000 - that's not including the organ. That's the cost of just procuring the organ through the TransMedics program. Q: You said $100,000 for the NOP plus the cost of the disposable, the device? A: Correct. And then you added up the transportation and that's variable, but it's at least $10,000.",
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      "text": "We have a cold perfusion pump for kidneys. They cost less than $2,000 each so that just gets absorbed into the OPO cost, but it's $2,000. — Transplant surgeon and transplant program director at a major academic center in Pennsylvania; The bills from TransMedics could be $110,000-120,000, and that’s in addition to the transplant center’s organ acquisition fee that they’re getting from the OPO, which in itself is $50,000 to $70,000. — Prominent surgeon, leadership role at a major West Coast academic transplant center; We were looking at the cost of an organ on the NOP of over $100,000 - that’s not including the organ. That’s the cost of just procuring the organ through the TransMedics program. — One of the top liver transplant surgeons in the world, based at a leading Midwest academic center",
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      "text": "Source: Scorpion Capital consultation calls with experts",
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