The National Competition Agency of Georgia has started investigating four companies in the pharmaceutical market.

As stated in the information released by the National Competition Agency, the issue is related to the sharp increase in the prices of chronic and oncological medicine by importers and sales companies and the setting of alleged identical pricing.

"The investigation was based on the information and statements made public by the Ministry of Health regarding the compatibility of the actions of pharmaceutical companies with the competition legislation. The investigation started in two directions, which implies the possible abuse of the dominant position and the possible restrictive agreements of competition (the so-called cartel deals).

Companies under investigation and pharmaceutical associations will have the opportunity to present their positions/explanations in the process.

In 2022, in the pharmaceutical market, within the scope of monitoring, the agency issued 13 recommendations to improve the competitive environment. The process of implementation of the given recommendations is ongoing, of which 7 recommendations have been fully or partially implemented. In the same period, by the decision of the Government of Georgia, the mechanism of parallel import of medicines from the Republic of Turkey was launched. As a result, access to quality medicines increased, and as a result of increased financial access, consumers made savings of approximately 250 million GEL in the retail market. In the conditions of the reference pricing and the implemented/ongoing reform in the market, a significant increase of the mentioned index is expected.

At the moment, the National Competition Agency is considering 4 investigation cases - alleged cases of concerted action, abuse of dominant position, unfair competition and restriction of competition by the administrative agency. In 2023, the agency completed one investigation and established the fact of restriction of competition on the part of the administrative agency.

For information: the agency makes a relevant decision no later than 6 months after the start of the case investigation. Considering the importance and complexity of the issue, the investigation process can last up to 18 months. In case of anti-competitive action, the law provides for a fine in the amount of up to 5% of the turnover of the previous financial year of the violating economic agent," the information reads.

source: IPN