The Competition Commission on Wednesday dropped its investigation into allegations that pharmaceutical companies, Aspen Pharmacare Holdings and Equity Pharma, were involved in excessive pricing.
The Commission had in June initiated three investigations against both companies for suspected abuse of dominance and excessive pricing in the provision of specific cancer medicines in South Africa.
Five dominant pharmaceutical companies were probed for various alleged transgressions in the provision of lifesaving cancer drugs in South Africa, including Roche Holding AG and its USA-based biotechnology company Genentech Inc, as well as Pfizer Inc.
The Commission initially said that it was in possession of information that gave rise to “reasonable suspicion” that Aspen has and continues to engage in the excessive pricing in the provision of Leukeran, Alkeran, and Myleran.
At the time, Aspen was also under investigation by competition authorities in various European countries for alleged excessive pricing of these drugs.
However, on Wednesday the Commission made an about turn and said: “Based on the information gathered to date, the Commission has decided to drop the investigation against Aspen and Equity because an excessive pricing case cannot be sustained against them.
“In addition, in respect of Aspen, the investigation revealed that the revenues attributable to Myleran, Alkeran and Leukeran are very low as they were at the end of their lifespans (very few patients are on them.”
The Commission said with respect of Equity, the investigation revealed that the drug Xalkori Crizotinib (Xalkori) was not yet registered in South Africa and it was imported once with the permission of the Medicines Control Council.
“The high price charged by Equity was as a result of high cost incurred in importing the product from Germany. It is, therefore, unlikely that the price charged by Equity could pass the test for excessive pricing,” the Commission said.
The Commission said it was continuing to investigate the complaints initiated against Roche, Genentech and Pfizer.
In South Africa, only Roche’s branded versions of breast cancer drug Trastuzumab are available and are sold under the names Herceptin and Herclon. Genentech provides exclusive marketing rights to Roche for Trastuzumab in the country.
Roche is being investigated for engaging in excessive pricing, price discrimination and exclusionary conduct in the provision of breast cancer medicine, while Pfizer is being investigated for suspected excessive pricing of lung cancer medication in South Africa.