CNMC fines the main pharmaceutical companies producing PET radiopharmaceuticals with 5.76 million euros

Competition has proven that the two companies adopted a joint strategy to distribute supply contracts.

Identification plate in the CNMC building, in Madrid (Spain)

The National Commission of Markets and Competition (CNMC) has sanctioned a total of 5.76 million euros to the companies Advanced Accelerator Applications Ibérica (AAA) and, jointly and severally, to its parent company Novartis Groupe France, and to Curium Pharma Spain (Curium) and its parent company Glo Holdco, as well as two of its directors for a cartel offense consisting of an agreement to share the supply market for the radiopharmaceutical fluorodeoxyglucose (18-FDG).

Specifically, the companies formed a cartel that was distributed, for at least four years, the contracts for the supply of the radiopharmaceutical.

That conduct affected public and private hospitals and caused an increase in cost of the service provided to patients, as indicated by the body chaired by Cani Fernández.

Very serious offense

It is a very serious offense prohibited by article 1 of Law 15/2007 on the Defense of Competition and 101 of the Treaty on the Functioning of the European Union.

AAA and Curium are at the moment both only companies with the capacity to provide services to hospitals throughout the national territory, which has facilitated, according to the CNMC, the conduct of the conduct, maximized its effects and increased its ability to influence the determination of contracting conditions by hospitals.

Joint action

As a consequence of the credited infringement, the CNMC has imposed the following fines: Advanced Accelerator Applications Ibérica (1,523,421 euros) and Curium Pharma Spain (4,244,584 euros) and the directors Giovanni Tesoriere and Andrés Pérez Boada (46,000 euros, each one).

The CNMC has proven that the two companies now sanctioned adopted a joint strategy to distribute a large number of radiopharmaceutical supply contracts to public and private hospitals located in various regions of Spain.

The joint plan had two parts. The first of them outsourcing agreements: in those hospitals where there could be greater competitive tension, the company in a better position to supply the radiopharmaceutical due to the proximity of its cyclotron (particle accelerator) did not present the best offer.

In consecuense, was not awarded and the company with the most distant cyclotrons from the contracting hospital he was winning the award at a higher price than would have been the case under normal conditions. Subsequently, the successful bidder subcontracted the service to its competitor (which has the closest cyclotron) at a price significantly lower than that charged to hospitals.

The second part was the exclusive customer assignment. The companies maintained a non-competition pact in many centers of the national territory.

This materialized through self-exclusions in tenders (for non-appearance or the commission of errors in the bidding process) or for the presentation of offers at the maximum bid price.

Thus, allowed the competitor to win the contracts at prices substantially higher than those at which their proximity to customers would have allowed them to bid, given the certainty that their competitor would not act competitively.

These distribution agreements were carried out, at least, from June 2014 to November 2018, when the CNMC inspected the headquarters of both companies.