MyCC probes 7 local pharma firms for alleged anti-competitive agreements

KUALA LUMPUR: Seven pharmaceutical companies are being investigated by the Malaysia Competition Commission (MyCC) for alleged anti-competitive 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.

Its chief executive officer Datuk Abu Samah Shabudin (pix) today 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.

The MyCC has found among others that:

>> some medical wholesalers charge different prices for different suppliers for the same medicine;

>> 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 that are sold to suppliers.

Earlier in his opening speech at a forum on competition law in the pharmaceutical sector here, Domestic Trade, Co-operatives and Consumerism Minister Datuk Seri Hamzah Zainudin noted the medicines' prices, saying that in the private sector it is unregulated and wholly dependent on prevailing market forces.

"Without government control, manufacturers, distributors, and retailers set medicine prices. Numerous studies conducted over the years have established that Malaysians pay very high prices for pharmaceutical drugs in the private sector, turning Malaysia into becoming a 'high price island' for pharmaceutical prices.

"I believe the time has come for the MyCC to not only regulate the competition aspect of the law, but to play a supportive role to achieve the objective of affordable medication. This can be achieved by being an advocate for competition and focusing on the eradication of anti-competitive practices," he said.