Mon. Sep 21st, 2020

Heavy fine imposed upon GlaxoSmithKline Pharmaceuticals Ltd. and Sanofi Pasteur India for anti-competitive practice

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Competition Commission of India (CCI): CCI imposed a total fine of about Rs 64 crore on GlaxoSmithKline
Pharmaceuticals Ltd. and Sanofi Pasteur India for collusive bidding in supply
of a meningitis vaccine to the government for Hajj pilgrims and subsequently
plotting to charge higher prices in the government tender for the said vaccine.
The order of Commission came upon an information filed by Bio-Med Pvt. Ltd., a
pharma company, which also makes polysaccharide Quadrivalent Meningococcal
Meningitis (QMMV) vaccines. The information was filed against GlaxoSmithKline
Pharmaceuticals Ltd., Sanofi Pasteur India and Health and Family Welfare Ministry
was also made party in the matter. It was alleged in the information that
Government introduced and modified the turnover conditions for eligibility of
the participating bidders to supply the particular vaccine without any
reasonable rationale and explanation. It was further alleged that
GlaxoSmithKline Pharmaceuticals Ltd. and Sanofi Pasteur India, also cartelized
through bid rotations and geographical allocations. CCI in its investigation
found that both companies were acting pursuant to an anti-competitive agreement
and formed a cartel to get government tenders to supply meningitis vaccine
which was required to be administered upon the pilgrims who wish to go on
annual pilgrimage of Hajj. After perusal of material on record and hearing both
the parties, CCI found GlaxoSmithKline Pharmaceuticals Ltd. and Sanofi Pasteur
India liable for violation of the provisions of the Competition Act, 2002 and
levied penalty to the extent of three per cent of the turnover both on
GlaxoSmithKline Pharmaceuticals Ltd. and Sanofi Pasteur India (aggregating to
Rs 60.49 crore and Rs 3.04 crore, respectively) and gave both companies sixty
days to deposit the amount. Apart from imposing penalties, the Commission has
directed GlaxoSmithKline and Sanofi to “cease and desist” from
anti-competitive practices, [In re: Bio-Med Pvt. Ltd. v. Union of India, [2015]
CCI 11, decided on 04.06.2015]
Source: Legal news India

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