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Mediclinic News : Aspen in competition commission price-fixing probe

Title

Aspen in competition commission price-fixing probe

Date

2017-04-24

Link

News Description

FIN24.COM Cape Town - Pharmaceutical firm Aspen Pharmacare [JSE:APN], which is under preliminary investigation for alleged anti-competitive behaviour, said it welcomes the process and the opportunity to set these allegations aside. In a company statement, the firm said it is committed to full and constructive engagement with the Competition Commission. Aspen in its statement however points out that pharmaceutical prices are approved by the Department of Health in terms of the Single Exit Price regulatory framework, which establishes a universal fixed price for each pharmaceutical product. It said: "Aspen has not increased pricing of its products outside of this regulatory framework." The Democratic Alliance (DA) last week lodged a complaint with the Competition Commission and the Medicines Control Council to investigate claims of anti-competitive behaviour by Aspen. Sipho Ngwema, head of communications at the Competition Commission said in an emailed response to Fin24 that Aspen would form part of the commission's preliminary investigation into the pharmaceutical sector to determine whether there is merit to launch a full-scale investigation. "The healthcare sector, particularly pharmaceuticals, is a priority sector for the commission’s enforcement efforts owing to the likely negative impact that anti-competitive conduct in that sector would have on consumers in general and specifically the poor and vulnerable. "In addition, the Competition Commission, together with the competition authorities from the other BRICS (Brazil, Russia, India, China and South Africa) countries, are studying the pharmaceutical sector to ascertain if there are any features of that sector that require regulatory intervention." Ngwema said the complaint lodged by the DA came at an opportune time and will form part of the commission’s preliminary investigation. Fin24 earlier reported that Aspen, according to UK reports, secretly planned to destroy life-saving cancer medicines as a threat to force countries in Europe to allow price hikes. The company is already in an ongoing legal process with European regulators as well as a court in Italy. The report alleges that prices for busulfan, a drug used by leukaemia patients, jumped from £5.20 (R87.32) to £65.22 (R1 095.17) a pack in England and Wales during 2013. DA health spokesperson Wilmot James said in a statement that the allegations against Aspen are serious, and called for an immediate investigation into the business ethics of "a reputable and proudly South African company". “Given the reports about how the cost of cancer drugs in Europe have been inflated, an investigation by the Competition Commission and the Medicines Control Council must, therefore, look into whether the same tactics are being used in our own country. “It appears to be an effort to manipulate the market for drugs that effectively will put them out of reach for many if not most," James said. The Aspen Group’s total revenue for the year ending June 30 2016 was R35.6bn. Its share price declined by 17.65% in the last year and was 1.36% down at R259.72 at 11:42 on Monday.
Created at 2017/05/03 04:55 PM by Mediclinic
Last modified at 2017/05/03 04:55 PM by Mediclinic