Competition Agency fines 4 pharmaceutical companies $19mln for antitrust price-fixing
The Agency noted the information made public on March 23 by the Ministry about price hikes and the price-fixing on the medicines by importers and distributors of oncological medicines had served as the basis for its investigation. Photo: Nino Alavidze/Agenda.ge
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The Georgian National Competition Agency on Friday announced it had fined four pharmaceutical companies ₾53 million ($19 mln) for price-fixing on oncology medicines funded within the state programme.
The Agency stated its study had identified 42 medicines with identical prices from the companies Aversi, PSP, Gepha and Mermisi against competition regulations, with the instances taking place between 2021 and 2023.
The body said it had revealed 88 cases of identical pricing, including 23 cases with the participation of two companies, 47 cases involving three companies and 18 cases involving four companies.
It alleged the moves represented a “coordinated effort” to limit competition and were a “severe form” of violation of the competition legislation.
Aversi was fined ₾14.4 million ($5.3 mln), with Gepha issued a ₾20.3 million ($7.5 mln) penalty, PSP ordered to pay ₾17.0 million ($6.3 mln) and Mermisi penalised ₾951,301 ($354,332).
In his comments, Minister of Health Zurab Azarashvili said the price-fixing meant consumers had been “left without medicines”, as “artificially increased” prices on oncological drugs from the four companies resulted in "premature expiration” of limited state funds designated for the medicines.
The charge is very serious. [...] The materials prove the companies clearly engaged in agreements for specific medicines. [The entities planned] to use artificially hiked prices to ensure compensation by the state and cause significant damage to citizens”, he said.
In its statement, the Ministry said the practices amounted to “unhealthy competition, artificial increase in prices, concerted actions and artificial shortage of medicines” from the companies and noted they involved medicines not yet covered by the state reference price policy and sold at prices set at “3,000, 2,000 and 1,000 percent” of their intended cost.
The body added the “dishonest actions directed against the state and its citizens” were “unacceptable” and added it would show “strict response to each violation”.
The Agency noted the information made public on March 23 by the Ministry about price hikes and the price-fixing on the medicines by importers and distributors of oncological medicines had served as the basis for its investigation.
Health Minister Zurab Azarashvili on Thursday said reference prices on medical drugs would be applied to additional 2,000 medicines in Georgia, starting next year.
The Georgian Health Ministry on Tuesday said large pharmacy companies “artificially” increasing prices on medicines not yet covered by reference price policy was “unacceptable”.
The number of medicines sold through the system of reference pricing across Georgia has been increased to 2,300, the Government Administration announced on Thursday. The list now included antihypertensive, anticoagulant, antihistaminic, antibiotic, gastrointestinal, analgesic and anti-inflammatory drugs.
Patients in Georgia spending money on medication for chronic illnesses will have up to 90 percent of their expenses reimbursed in a state programme by 2026, Health Minister Zurab Azarashvili said on Monday.
Georgian Prime Minister Irakli Garibashvili on Monday said the reference price mechanism, set to be introduced in a Government initiative across Georgia next month, would reduce the cost of medical drugs by an average of 40 percent.
A range of medical professions across Georgia will see a salary increase and a mandated minimum wage with the entering into force of clauses in a related reform starting this month, the Ministry of Health announced.
The Ministry of Health of Georgia has set new standards for dental clinics, tightening rules for launch and operation of venues across the country.
Georgian Health Minister Zurab Azarashvili on Monday said the Ministry was ensuring “daily” monitoring of oncological and other medical drugs in the domestic pharmaceutical market, following the National Competition Agency’s fining of pharmacy networks last month for price-fixing.
The Competition and Consumer Protection Agency of Georgia on Tuesday announced it had fined three companies ₾1.6 million ($595,954) for an arrangement that granted exclusive rights to selling cinema tickets online in violation of competition law.
The Georgian Government on Monday announced an expansion in the drug programme for beneficiaries with chronic illnesses, as well as an increase in social assistance packages for disabled individuals, including children.
The Georgian Competition and Consumer Agency on Tuesday said 18,138 concentrations of economic agents had been registered in the country in the fourth quarter of 2023.
Georgian Prime Minister Irakli Kobakhidze on Tuesday said the “rapid growth” of the domestic healthcare sector had led to “cartel deals” and “flawed processes” between pharmacy companies in the country, in comments to cases highlighted by the Health Ministry and confirmed by the Competition Agency.