Bundeskartellamt imposes fines against pharmacists on account of price agreements for non-prescription medicines

In late December 2007 the Bundeskartellamt imposed fines totalling 150,000 euros against eight pharmacists in the City of Hildesheim.

Since early 2004, non-prescription but pharmacy medicines (so-called OTC medicines) are no longer subject to resale price maintenance so that each pharmacist is free to determine his prices. The legislator’s intention was to set in motion price competition for these medicines. In order to restrict the price competition which they feared, various market participants took measures that violated competition law (see today’s press release regarding the Land pharmacist associations and the proceedings pending against Bayer Vital of 11 October 2007).

In late 2006 / early 2007 about 50 pharmacies based in the Hildesheim area had advertised joint prices for selected non-prescription medicines, thus violating the ban on cartels. This occurred against the background of plans by a so-called discount pharmacy to set up a branch in Hildesheim. Some pharmacists in Hildesheim feared they would also be exposed to price competition in the future. To prevent this danger they set up a joint advertising group which advertised reduced prices they had agreed on for individual medicines. This was meant to make market entry difficult or impossible for the discount pharmacy and to prevent an extension of price competition between the Hildesheim pharmacies.

Fines amounting to 25,000 euros were imposed on the three pharmacists who had initiated the joint advertising campaign. Five further pharmacists, who were also actively involved, received fines amounting to 15,000 euros each. Proceedings against the other pharmacists were discontinued as these had only been involved to a lesser extent.

The restriction of competition only had an effect in Lower Saxony; the Lower Saxony competition authority then referred the proceedings to the Bundeskartellamt.

The orders imposing the fines are not yet final.