Clamping down on unfair trade practices in pharma space, the Competition Commission today imposed a penalty of Rs 10.62 lakh on Chemist and Druggists Association, Goa.
Coming down heavily on the association, the fair trade watchdog also observed that the "case involved continued contravention and utmost disrespect" to its earlier directions.
Back in 2012 also, the Competition Commission of India (CCI) had penalised the Chemists and Druggists Association, Goa (CDGA) and at that time the fine amount was Rs 2 lakh.
In its latest order, the Commission has imposed a fine of Rs 10.62 lakh on CDGA, an amount that translates to ten per cent of the association's average receipts. The same is to be deposited within 60 days of receiving the order.
The latest ruling has come on a complaint filed by Xcel Healthcare and it was brought to the notice of the Commission that CDAG was restraining pharmaceutical companies such as Glenmark Pharmaceuticals and Wockhardt from doing business with non-authorised stockists.
A detailed investigation revealed that CDAG was indulging in anti-competitive practices in complete disregard to the Commission's order dated June 2012.
"It was found that CDAG was continuing to exercise control on the supply chain through which drugs and medicines are made available in the market through the practice of requirement of LOC/NOC (Letter of Consent/No Objection Certificate) prior to appointment of stockists by pharmaceutical companies without having any legal or statutory authority in this respect," the statement said.
According to the watchdog, CDAG forced pharmaceutical companies to follow its mandate by threatening other stockists in Goa to stop taking supplies or suspend receiving supplies from them till such time they stopped supplies to unauthorised stockists such as Xcel Healthcare.
In February this year, the Commission had cautioned that certain activities such as giving instruction to chemists and druggists to restrict discounts on drug sale are unfair in nature.
