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Justice investigates Red Cross contract

Published Sep. 13, 2005

The Justice Department has begun an antitrust investigation of the American Red Cross centered on its exclusive contract to sell a possible new blood-scrubbing technology.

Competitors fear that if the Red Cross controls the new technology for scrubbing the AIDS and certain other viruses out of plasma, some of the smaller banks that provide half the nation's blood could be forced out of business.

The nation's blood supply already is very safe, experts stress, because of numerous tests for infection. But scientists have been hunting ways to make it even safer, avoiding even the occasional infection that slips through.

The military considered this new scrubbed blood, called SD plasma, enough of an advantage that it put an alternative improved blood program on hold to await it. Thus, the Pentagon was upset when manufacturer Vitex suddenly informed officials of its deal to sell only to the Red Cross.

"I am extremely concerned that this exclusive agreement with the (American Red Cross) provides them with a monopoly over all SDP produced within the United States," Capt. Bruce Rutherford, director of the Armed Services Blood Program, wrote Vitex in November.

The Red Cross vigorously defended its new contract Saturday. A spokeswoman said the charity was confident it had violated no antitrust laws and would respond quickly to recent Justice Department subpoenas.

Justice officials would not comment.

The Red Cross will sell SD plasma to nonmember blood banks, charging them an as-yet-undetermined markup to recoup its investment, including a $3-million loan to Vitex, said Brian McDonough, chief operating officer of Red Cross blood services.

Some scientists aren't sure the technology is worth the fuss.

The Food and Drug Administration has not yet approved SD plasma, privately saying it is not such a lifesaving product that it should sweep the market. An FDA advisory committee advised the agency last month that an alternative method of better blood testing, also awaiting FDA approval, is equally effective.

Scrubbed plasma "adds a certain degree of safety that regular plasma doesn't have, but it also has some potential downsides to it," said Dr. Harvey Klein, transfusion chief at the National Institutes of Health. "I'm concerned that it might be aggressively marketed" without acknowledging the drawbacks.

The New York Blood Center developed the new technology, solvents and detergents that dissolve the fatty coating of such viruses as HIV, hepatitis B and hepatitis C, then wash them out of the plasma.