Legal Alliance Company Held a Round Table "The Future of Distribution Contracts in the Pharmaceutical Market: Is the Harbor Safe?"
On July 18, 2017, the round table "Future of Distribution Contracts in the Pharmaceutical Market. Is the harbor safe?" was held by Legal Alliance Company involving AIPM Ukraine at LigaBusinessInform press center. The event brought together over 35 representatives of the pharmaceutical business, profile associations and the media.
During the event, the draft AMCU decree "On Approving Standard Requirements on Vertical Coordinated Actions of Economic Entities on Supply and Use of Goods" and the prospects for its application to the pharmaceutical market were discussed.
The event was moderated by the associate partner of the Legal Alliance Company, Andrii Gorbatenko, who during the discussion told the audience about the concept of the safe harbor proposed by the draft AMCU order and its possible application to Ukrainian pharmaceutical market.
Andrii Gorbatenko pointed out that, unfortunately, the Model requirements would not create a safe harbor for most transactions in the pharmaceutical market of Ukraine, since the latter is characterized by a high level of concentration in the distribution segment and most of the distribution contracts would not meet the criterion associated with market shares .
"At the moment, there are two distributors in the Ukrainian pharmaceutical market and each of their shares already exceeds 30%. In addition, the AMCU's approach to determining the drug product market boundaries will reduce the chance to meet the criterion associated with market shares. According to this approach, medicines with the same active substance, dosage and dosage form constitute separate markets. This approach significantly narrows the markets, increasing the share of their participants," stated the expert.
Thus, the Standard requirements will lead most transactions in the pharmaceutical market to a risky zone. Such risks can be minimized by conducting internal expertise of a specific agreement for the competitive risks or by contacting the AMCU for conclusions in the form of recommendational explanation or permission to perform concerted actions. However, a more effective tool would be the publication of the AMCU recommendations for clarifying the application of the Model Requirements to transactions in the pharmaceutical market.
