CCI Closes Complaint Against Lupin Ltd. And Dr. Reddy Laboratories, Citing No Contravention Of Section 3 And 4 Of Competition Act
The Competition Commission of India ('CCI') comprising Ms. Ravneet Kaur (Chairperson), Mr. Anil Agrawal (Member), Ms. Sweta Kakkad (Member), and Mr. Deepak Anurag (Member) closed the complaint filed by Shri. Nadie Jauhri ('Informant') against Lupin Ltd. ('OP-1') and Dr. Reddy's Laboratories Ltd. ('OP-2') alleging violation of the provisions of Section 3 and Section 4 of the Competition Act,...
The Competition Commission of India ('CCI') comprising Ms. Ravneet Kaur (Chairperson), Mr. Anil Agrawal (Member), Ms. Sweta Kakkad (Member), and Mr. Deepak Anurag (Member) closed the complaint filed by Shri. Nadie Jauhri ('Informant') against Lupin Ltd. ('OP-1') and Dr. Reddy's Laboratories Ltd. ('OP-2') alleging violation of the provisions of Section 3 and Section 4 of the Competition Act, 2002 ('Act').
The CCI held that no prima facie evidence has been provided by the Informant to substantiate its allegations against OP-1 and OP-2 to warrant a case of contravention of Sections 3 and 4 of the Act.
Brief Facts:
The Informant provided that OP-1's procedure to refuse the supply of products to Indira Medical Agencies, Gole Colony, Nashik violated the Drug (Price Control) Order, 2013 issued under Section 3 of the Essential Commodities Act, 1965. Informant contended that no pharma company can impose its dictates over wholesalers. Moreover, while OP-1's policy might not violate the Drugs and Cosmetics Act, of 1940, it is in contravention to allow healthy competition. Further, it has been alleged that OP-1 did not have a Food and Drug Administration license, thereby supplying spurious/misbranded goods.
For OP-2, Informant contended that OP-2 appointed Shah Agencies, Nashik as its stockist but no agreement could not be implemented as Shah Agencies could neither obtain a No Objection Certificate (“NOC”) of Nashik District Chemist Association/ Maharashtra State Chemist Association nor manage a voluntary contribution for the association. Further, OP-2's sales team had sent emails to their distribution head recommending Indira Medical Agencies, Nashik to be added as a stockist and it was also turned down due to failure to obtain an NOC and voluntary contribution for the local association.
Observations of the Commission:
The CCI closed the case and held that no prima facie evidence has been provided by the Informant to substantiate its allegations against OP-1 and OP-2 to warrant a case of contravention of Sections 3 and 4 of the Act.
The Commission noted that the copy of the Office Memorandum dated 22.11.2021 provided by the Informant which has been issued by the National Pharmaceutical Pricing Authority, Ministry of Chemicals and Fertilizers does not prove that OP-1 violated provisions of the Act.
Further, the allegations concerned with the selling of expired goods and misbranding by OP-1 are not within the ambit of the Act.
Further, certain emails provided by the Informant relating to the non-implementation of the agreement by OP-2 provide no evidence of non-supply of drugs to Indira Medical Agencies for want of NOC and voluntary contribution to the local association. These emails appear to be like internal communication between the employees of OP-2 and do not substantiate the allegation.
In conclusion, the CCI observed that the Informant has not provided evidence to substantiate its allegations against OP-1 and OP-2, and thus, no case exists for contravention of Section 3 and Section 4 of the Act.
Case Title: Shri. Nadie Jauhri And Lupin Ltd. and Another
Case No.: Case No. 23 of 2023