The Belgian Competition Authority (BMA) has imposed a fine of 29.8 million on the pharmaceutical wholesaler Pharma-Belgium-Belmedis for prohibited market agreements. Febelco escapes the dance as a whistleblower. The smaller Cerp is refusing a settlement for the time being.
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The three pharmaceutical wholesalers have been found guilty of infringements of competition law. So says the competition watchdog BMA. However, the study that started in 2016 has three different results.
The largest pharmaceutical distributor, the cooperative Febelco, is on the rise. This is because Febelco was the whistleblower who informed the BMA in detail about the abuses. Pharma Belgium-Belmedis has to pay 29.8 million euros. That is still 40 percent less than the possible fine. The discount came about because Pharma Belgium-Belmedis provided additional information about the price manipulations.
The smallest player, the French Cerp, refuses to accept a settlement with the auditor and opts for a ‘court procedure’ in the lap of the BMA. There, the auditor will act as public prosecutor and try to make his case.
flu vaccines
Febelco and Pharma Belgium-Belmedis agreed to apply the same, less attractive, commercial terms. For example, they agreed on a pre-sale system for flu vaccines. Pharmacists received no discounts and no returns were accepted for unsold vaccines ordered during the presale period. This practice was ongoing from April 2003 to November 2016.
The pharmaceutical distributors also tried to make direct sales of products from pharmaceutical laboratories to pharmacists less attractive through the technique of ‘transfer orders’. Transfer orders are interesting for pharmacies, because they allow large quantities of products to be ordered directly under certain conditions.
The fine imposed by the BMA comes at a time when pharma distributors say their margins are too low due to ongoing drug savings. They ask the government to index their compensation.
Minister of Economy Pierre-Yves Dermagne (PS) is not interested in this. “The world is turned upside down when the industry is demanding that I increase margins and increase their profits, at the risk of increasing the price of medicines for the patient. It cannot be the intention that the government pays the fines it imposes itself.’
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