The CMA’s full text decision in the long-running Hydrocortisone case, originally initiated in 2016 and in which the CMA imposed record fines, is now published and it shows a slight rethink of the CMA’s approach to excessive pricing in the pharma sector.
The definition of excessive pricing as an abuse of dominance under competition law remains largely that outlined in the United Brands case from the 1970s, i.e. that the price bore “no reasonable relation to the economic value of the product”, which is assessed through a two-limb test of demonstrating that the difference between the cost incurred and the price charged was excessive (excessiveness limb) and the price was unfair either in itself or when compared to competing products (unfairness limb).
A link to the web version of this email update is available here. If you would like to receive these updates via email, please subscribe.
Charlotte Tillett