7 pharmas under probe
> Firms accused of forming cartel to monopolise drug market
KUALA LUMPUR: Seven pharmaceutical companies are being investigated by the Malaysia Competition Commission (MyCC) for alleged anticompetitive agreements and abuse of dominant positions in the sector.
Companies can distort competition by cooperating with competitors, fixing prices or dividing the market up so that each one has a monopoly in part of the market. Anti-competitive agreements can be open or secret (e.g. cartels).
Abuse of a dominant position occurs when a dominant firm in a market, or a dominant group of firms, engages in conduct that is intended to eliminate or discipline a competitor or to deter future entry by new competitors, with the result that competition is prevented or lessened substantially.
MyCC chief executive officer Datuk Abu Samah Shabudin ( pix) yesterday said the investigation is being conducted together with the Health Ministry.
He said the firms are part of the 13 cases and 11 complaints received thus far.
MyCC has found, among others, that:
some medical wholesalers charge different prices for different suppliers for the same drug;
an attempt to monopolise medicine supply by both local and foreign pharmaceutical firms.
He said “abuse” in pricing existed because there is no fixed price for medicines sold to suppliers.
Earlier in his opening speech at a forum on competition law in the pharmaceutical sector, Domestic Trade, Cooperatives and Consumerism Minister Datuk Seri Hamzah Zainudin said he noticed that prices of medicines in the private sector are unregulated and wholly dependent on market forces.
“Without government control, manufacturers, distributors, and retailers set medicine prices. Numerous studies have established that Malaysians pay very high prices for pharmaceutical drugs in the private sector, turning Malaysia into a ‘high price island’ for pharmaceuticals.
“I believe the time has come for MyCC to not only regulate the competition aspect of the law, but also play a supportive role to achieve the objective of affordable medication,” he said.