India competition body cracks down on GSK, Sanofi
Citing an anticompetitive agreement that was "clearly made out," India's Competition Commission took issue with GlaxoSmithKline ($GSK) and Sanofi's ($SNY) operations in the country this week and fined the international pharmas nearly $10 million.
The body ordered GSK to pay $9.4 million in fines and to "cease and desist" its "collusive bidding" practices in supplying the government a meningitis vaccine for approximately 200,000 Haj pilgrims annually. Sanofi was fined about $500,000.
The complaint, focusing on the supply of polysaccharide Quadrivalent Meningococcal Meningitis vaccine, was brought by local vaccines firm Bio-Med and also implicated India's Health and Family Welfare Ministry in the process. Each year, the Indian government solicits bids for the purchase of the vaccines that are required to be given to the Haj pilgrims. In its finding, the competition commission said that the parties failed to establish independent business decision-making.
In their responses to FiercePharmaAsia, both companies denied the allegations.
"We believe that we have complied with all applicable laws, including competition laws," a GSK representative wrote to FierceVaccines. "GSK seeks to operate with the highest levels of integrity and in full compliance of local regulations. GSK India will consider all options following review of the order passed and take action as appropriate."
The commission said the "peculiar market conditions, including the presence of only three suppliers of the QMMV vaccines" made the market "conducive to collusion." In November 2014, India's Director General submitted a report, alleging that the government was involved in the process by changing the bidding criteria on the vaccine.
For GSK, the fine follows several others, as it was recently taken to task in 2013 and 2014 over its $489 million bribery scheme in China, ultimately leading to the same amount in fines. But the news comes as GSK has upped its ante in the vaccines space. After shipping off its oncology portfolio to Novartis in exchange for the Swiss drugmaker's vaccines stall, GSK is counting on vaccines to grow at a compound annual rate in the mid-to-high single digits between 2016 and 2020.
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