Rosa M. Abrantes-Metz
Dr. Rosa M. Abrantes-Metz is a Managing Director in the antitrust, securities and financial regulation practices of Global Economics Group based in New York. Her experience includes work in consulting and banking, as well as in government. Her main areas of specialization are econometrics, monetary and financial economics, and applied industrial organization. Dr. Abrantes-Metz is an adjunct associate professor at Leonard N. Stern School of Business, New York University, where she teaches money and banking, financial institutions, industrial economics, and econometrics for MBA's. She has taught econometrics at the department of economics at the University of Chicago, and various other fields of economics at Universidade Católica Portuguesa, in Lisbon, Portugal. Dr. Abrantes-Metz's work is regularly featured in the media such as the Wall Street Journal, Financial Times, The Economist, CNNMoney, CNBC, Forbes, Bloomberg, BusinessWeek, Washington Post, Huffington Post, Reuters, Crain's, Risk Magazine, Investor's Business Daily, Sky News TV and BBC Radio.
- Rosa M. Abrantes-Metz
- Managing Director, New York
- antitrust/competition policy, financial regulation, securities
After working as a staff economist at the Federal Trade Commission, Dr. Abrantes-Metz continued to serve as a consultant for special projects with the Commission’s Bureau of Economics and she is also a consultant for the World Bank. Dr. Abrantes-Metz is the author of several articles on econometric methods and screens, conspiracies and manipulations, gasoline, pharmaceuticals and health care, telecommunications, monetary policy, event studies, valuation, structured finance, credit default swaps, credit ratings and new statistical tests, representing some of the areas in which she has also worked as an economic consultant. Dr. Abrantes-Metz has published in various peer-reviewed journals and trade publications. She is a co-drafter of the chapter on the role of the economic expert in proving conspiracy cases under federal antitrust laws in a recent volume published by the American Bar Association. In addition she has contributed to other books on international arbitration with a focus on event studies, and is a co-author of the chapter on corporate governance and compliance forthcoming in the next Handbook on Antitrust Economics.
Dr. Abrantes-Metz has developed numerous empirical screens for conspiracies and manipulations, and is a pioneer in the field, contributing to the further development and increased adoption of these methods. She has flagged potential anticompetitive behavior preceding large scale investigations, such on the alleged Libor conspiracy and manipulation, and has also used these methods to defend against allegations of such behavior. Her screens are used by competition authorities, defendants and plaintiffs worldwide. In pharmaceuticals, she has co-developed a model to estimate the likelihood of drugs failing and succeeding each of the clinical stages of the Food and Drug Administration, and their expected durations in each of these phases. This model has become one of the two most used by industry analysts to value pharmaceutical and biotechnology pipelines. Dr. Abrantes-Metz has provided testimony related to alleged bid-rigging, price-fixing, market allocation, and on valuation of oil services and utilities services companies.
Dr. Abrantes-Metz holds a Ph.D. and a Masters in Economics from the University of Chicago. She also holds a Masters in Economics from the Universitat Pompeu Fabra in Barcelona, Spain, and a Licenciatura in Economics from Universidade Católica Portuguesa in Lisbon, Portugal.
SELECTIVE EXCERPTS FROM DECISIONS
- 184. BP argues that the ID errs in giving Abrantes-Metz significant weight because she had no experience in natural gas markets and had not testified in any case in the United States involving alleged manipulation of natural gas or power markets. However, the ID directly considered BP’s “challenges [to] this witnesses qualifications to testify as an expert in gas trading” and found that she was “more than amply qualified to testify in this proceeding.” Having determined that Abrantes-Metz’s testimony and evidence was admissible under Rule 509, the ALJ then determined that the substance of Abrantes-Metz’s testimony and evidence deserved significant weight in light of the record. BP’s attacks on Abrantes-Metz’s qualifications, which the ID considered sufficient to qualify her testimony and evidence for admission in this proceeding, provide no basis for the Commission to reject the ALJ’s determinations regarding the weight and credibility afforded to Abrantes-Metz and her testimony and evidence. – (Source: Appeal Decision: BP found guilty of natural gas market manipulation).
- 239. The ID also found that Enforcement Staff expert witness and testimony conclusively showed Comfort’s explanations to be not credible. The ALJ found Abrantes-Metz’s testimony to show conclusively that the confluence of factors in this case indicates that there is no legitimate reason to explain the Texas Team’s trading patterns other than manipulation.” – (Source: Appeal Decision: BP found guilty of natural gas market manipulation).
Antitrust, Oil & Gasoline, Pharmaceuticals, and Health Care
- Alleged Conspiracies. Provided expert testimony on an alleged cartel case involving price-fixing, bid-rigging and market allocation. Developed numerous empirical approaches to address materiality and likelihood of such behaviors, and to address the alleged exchange of information among competitors. Estimated potential overcharges.
- Class Actions Certification and Price-Fixing. Addressed class certification using various empirical methods to determine similarity of effects across consumers allegedly belonging to the class in a price-fixing conspiracy case.
- Alleged Conspiracies and Manipulations of Oil Price Indices. Developed empirical approaches to determine whether there was evidence of a material impact of an alleged manipulation of the Platts Index for oil. Studied trading data across all market players to address price materiality, causation, market power and possible motive. Studied other related commodities and markets. Calculated allegedly illegal profits and damages.
- Alleged Conspiracy among Business Partners. Developed an innovative approach to detect collusion based on survey data. Studied whether the patterns of responses to a survey by business partners were indicative of collusion and identified potential suspects.
- Guidelines on Exchanges of Information among Competitors. Authored the guidelines on best practices for exchanges of information among competitors for Central and South American countries, and also specifically for Mexico.. Advised on how to incorporate these guidelines into the Mexican Antitrust Laws currently under revision.
- Collusion Detection in Gasoline Markets. Developed empirical screens to detect conspiracies in gasoline markets. Applied screens to the US retail and whole sale data. Contributed to the FTC’s gasoline monitoring program. Work performed as an FTC economist.
- Mergers and Acquisitions in Pharmaceuticals. Worked on various mergers in the pharmaceutical industry and addressed potential anti-competitive effects. Work performed both as an FTC economist and as an economic consultant.
- Vertical Restraints in Pharmaceuticals. Expert report on vertical restraints related to an acquisition of major wholesalers by the national association of pharmacies in Portugal. Report focused on tying, bundling and exchanges of information.
- Brand Name vs. Generic Pharmaceutical Drugs. Estimated the effect of generic entry on price, volume and market shares of branded drugs in particular therapeutic areas to estimate the but-for scenario absent of generic entry. Estimated alleged damages.
- Material Adverse Change in Connection with Acquisitions. Determined the materiality of a disclosure on the existence of a price-fixing conspiracy sometime in the past, which could have affected a later decision to acquire a company.
- Merger in the Poultry Industry in Brazil. Co-authored a report on the estimation of the elasticities of demand across products in the same relevant market in a consummated acquisition in the Brazilian poultry industry. Estimated efficiency gains and price changes due to the acquisition.
- Mergers and Acquisitions in the Oil and Gasoline Industry. Developed various econometric approaches to estimate the possible effect on gasoline prices of major oil company mergers. Some of these approaches required looking into potential for future collusive behavior. Work performed both as an FTC economist and as an economic consultant.
- Daily Gasoline Pricing Forecast. Developed an econometric model for a major oil company to predict daily gasoline prices for all its competitors at the terminal level, and across all terminals in the United States. The model significantly improved analysts’ forecasts and assisted daily pricing decisions.
- Trends and Cycles in Gasoline Prices. Decomposed movements in gasoline prices between long-run and short-run components, across 365 cities in the United States. Work performed as an FTC economist.
- Spectral Test for Mergers and Acquisitions. Developed a new statistical test in the frequency domain and applied it to antitrust market definition in gasoline markets. This test was later used for other applications including in financial markets. Work performed as an FTC economist.
- Prediction of Hart-Scott-Rodino Filings. Developed econometric models to predict HSR filings as a function of major economic indicators. Work performed as an FTC economist.
- Estimation of Likelihood of Success and Duration of Drugs in Clinical Stages. Co-developed a duration model to estimate the likelihood of success and failure of drugs in each of the clinical stages of the Food and Drug Administration, as a function of various drugs characteristics. The model also estimates the expected duration for each of the drugs based on the same characteristics. Model informs mergers and acquisitions, intellectual property and valuation. Used as supporting evidence in FTC decisions such as in the Genzyme Corporation / Novazyme Pharmaceuticals, Inc., 2003 merger. Work performed as an FTC economist and as an economic consultant.
- Mergers and Acquisitions in Other Areas. Worked on mergers and acquisitions in various other industries such as sporting goods, cable television, boats, railroads, appliances, entertainment, animal feed ingredients, aspartame and other artificial sweeteners, supermarkets, and real estate.
- Health Care Costs and Innovation. Developed a new econometric approach to estimate the contribution of technological progress to the increase in health care expenditures in the United States over the last four decades.
- Benefits of Health Care Spending. Developed simple econometric models to assist in determining if countries spending more on health care also experience greater benefits from such spending.
Securities, Valuation, Risk Assessment, Financial Regulation, Conspiracies and Manipulations
- LIBOR Conspiracy and Manipulation, and Illegal Behavior in Other Similar Benchmarks. Analyzed liability and damages in LIBOR matters on various currencies, and also on comparable benchmarks around the world.
- Reform of LIBOR and Other Financial Benchmarks. Advised on methodology, governance, regulation, transition and implementation of reforms of key financial benchmarks around the world.
- Alleged Manipulations of Stock Prices. Developed empirical approaches to determine whether an alleged revenue management episode in the computer industry materially affected the stock price of the company.
- Alleged Manipulations of Hedge Funds Accounts. Developed empirical approaches to estimate the likelihood that the observed patterns in trading and in profits by a particular trader were the result of a manipulation to maximize profits of specific accounts.
- Alleged Conspiracy between Brokers and Dealers. Estimated but-for transaction prices in an alleged conspiracy between brokers and dealers of a major financial institution. Evaluated execution quality when compared to unsuspected benchmarks. Estimated allegedly illegal profits and consumers’ disadvantage.
- Commodities Futures Contracts Alleged Manipulations. Developed empirical approaches to determine whether commodities futures prices of various precious metals were manipulated. Defined relevant markets, estimated price artificiality, addressed causation and market power. Studied floor and electronic trading, and where price discovery took place. Linked analyses to cash markets and related commodities. Estimated but-for trading, allegedly illegal profits, and potential damages.
- Credit Ratings and Risk. Analyzed the evolution of structured finance ratings during the eruption of the latest financial crisis in the United States. Timed these changes with various measures of increased risk in the market and disclosures of exposures to this risk by major financial institutions.
- Valuation of Structured Finance Securities. Analyzed econometric models and assumptions used to value structured finance securities, namely RMBS and CDOs, during the eruption of the financial crisis. Evaluated models’ sensitivities to stress scenarios and calibrations. Developed models for RMBS cumulative losses based on corporate default models, and tested model implications on mortgages correlations, crossed-pool correlations, and volatility of house price growth and of cumulative losses against actual and forecasted data.
- Risk Assessment in the Financial Crisis. Developed and implemented a sophisticated Markov Regime Switching Model to identify the evolution of risk in ABX indices from 2007 through 2009, which allowed for five different states of variable intensity and volatility. Applied various measures of relative risk in the literature to the financial crisis.
- Analysis of Disclosures during the Subprime Mortgages Crisis. Matched companies’ disclosures of information related to the exposure of particular assets to the evolution of risk in the market place.
- Valuation of Expropriated Assets in the Oil Industry. Provided testimony on an international arbitration matter on the value of expropriated assets belonging to a publicly traded oil services company in Central America.
- Valuation of Utilities Assets. Provided expert testimony on the valuation of a utilities company, containing a fairness opinion and addressing robustness and appropriateness of various valuation methods employed during a merger and acquisition process. Addressed issues related to material adverse change with respect to the acquisition.
- Valuation in the Pharmaceutical and Biotechonology Industries. Opined on the price offered by a major pharmaceutical company to purchase a leading biotechnology company. Used discounted cash flow models and event studies. Estimated the value of the biotechnology R&D pipeline.
- Section 10b-5 Securities Litigation. Used event studies to estimate the effect of alleged frauds on companies’ stock prices and the economic value of the effect.
- Insider Trading. Analyzed the materiality of the gain allegedly obtained through insider trading. Evaluated stock price reactions and bond prices to the allegedly private and illegally obtained information. Determined the extent to which such information had previously been known and assimilated by the market.
- Testing for Market Efficiency. Implemented a variety of statistical tests for market efficiency of particular securities during the financial crisis and compared results with those prior to the crisis. Assessed and explained changes and the appropriateness of the assumption of market efficiency.
- Analysis of Credit Default Swaps. Analyzed the information content of credit default swaps and determined the material impact of having only quote data available rather than final transaction prices for the market in general.
- Stock Options Backdating and Spring Loading. Developed various empirical screens to determine whether patterns observed in stock price excess returns related to alleged stock options backdating and spring loading were statistically anomalous. Studied the materiality of these events.
- Trading in Major Stock Exchanges. Determined whether brokers and dealers in major stock exchanges illegally profited from buying and selling transactions. Estimated allegedly illegal profits and consumers’ disadvantage.
- Materiality of Disclosures. Investigated whether the disclosure of an alleged conspiracy between members of the same industry materially affected stock prices of the companies in the same industry.
- Material Adverse Change in Connection with Merger Agreements. Determined materiality of the stock price response to information not disclosed prior to an acquisition, information which may have affected the acquisition decision itself had it previously been known.
- Drug Recalls. Estimated damages associated with the recall of major blockbuster drugs.
- Asbestos. Estimated damages associated with construction workers’ exposure to asbestos.
- Macroeconomic Effects of Airport Expansion. Estimated the macroeconomic and sectors specific impacts of the expansion of the Lisbon airport into the Portuguese economy.
- Postal Services Modeling. Developed a new econometric model to predict demand for the United States Postal Service. Model results assisted management on decisions related to pricing and product innovations.
- Patent infringement in Medical Devices. Estimated lost profits due to alleged patent infringement in the medical device industry.