Aspen off the hook over cancer drug pricing

Johannesburg – The Competition Commission has decided to drop its investigation into Aspen Pharmacare [JSE:APN] over excessive pricing of cancer medicines.

In June the Commission launched the investigation against oncology medicine providers Roche, US-based biotechnology company Genentech, Pfizer, Equity and Aspen.

Aspen particularly was being investigated for allegedly abusing its dominance to charge excessive prices for cancer medication in South Africa.

At the time Commissioner Tembinkosi Bonakele said the matter was of “grave national importance”.

But on Wednesday the Commission announced that Aspen and Equity would no longer be investigated, because an excessive pricing case could not be sustained against them.  

The investigation revealed that revenues attributable to Aspen’s medicines Myleran, Alkeran and Leukeran, were very low as they were at the end of their lifespans with few patients on them, the Commission said.

Stephen Saad, group chief executive of Aspen welcomed the decision by the Commission and thanked Bonakele and the investigating team for the “expeditious and co-operative manner” in which the investigation was handled, the group said in a note to investors.

Regarding Equity, the Commission found that the drug Xalkori Crizotinib is not yet registered in South Africa. “It was imported once with the permission of the Medicines Control Council. The high price charged by Equity was as a result of high cost incurred in importing the product from Germany,” the Commission explained. “It is, therefore, unlikely that the price charged by Equity could pass the test for excessive pricing.”  

The Commission is continuing its investigation into Roche, Genentech and Pfizer.  Roche and Genentech have allegedly engaged in excessive pricing, price discrimination and exclusionary conduct in the provision of breast cancer medicine. Pfizer is suspected of excessive pricing of lung cancer medication. 

Aspen's share price closed at R304.27 on Thursday.

SUBSCRIBE FOR FREE UPDATE: Get Fin24's top morning business news and opinions in your inbox.

Read Fin24's top stories trending on Twitter:

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For 14 free days, you can have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today. Thereafter you will be billed R75 per month. You can cancel anytime and if you cancel within 14 days you won't be billed. 
Subscribe to News24
Rand - Dollar
15.57
+1.0%
Rand - Pound
19.66
-0.0%
Rand - Euro
16.71
-0.0%
Rand - Aus dollar
11.15
-0.0%
Rand - Yen
0.12
-0.0%
Gold
1,853.66
0.0%
Silver
22.12
0.0%
Palladium
2,076.50
0.0%
Platinum
956.50
0.0%
Brent Crude
119.43
+1.7%
Top 40
63,883
+1.4%
70,486
+1.4%
Resource 10
76,948
+0.6%
Industrial 25
76,115
+1.3%
Financial 15
16,257
+2.5%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot