Vivek Sharma Vs Fortis Escorts Heart Institute and Research Centre Ltd. (Competition Commission of India)
The Competition Commission of India examined allegations arising from Information filed under Section 19(1)(a) of the Competition Act, 2002 concerning the conduct of private super-specialty hospitals in Delhi, including Fortis Escorts Heart Institute and Research Centre Ltd., New Delhi. The matter initially involved allegations that disposable syringes sold through an in-house hospital pharmacy carried higher Maximum Retail Prices (MRP) than those sold in the open market.
The Director General (DG) investigated the matter and found no evidence of collusion or exclusive agreement between the syringe manufacturer and the hospital. The Commission accepted the finding that there was no contravention of Section 3(3) of the Act. However, the DG also examined whether private super-specialty hospitals were abusing their dominant position by compelling in-patients to procure medicines, consumables, medical devices, and diagnostic services only from in-house facilities at allegedly excessive prices.
A supplementary investigation was conducted covering 12 super-specialty hospitals in Delhi. The DG concluded that each hospital constituted a separate relevant market for in-patients admitted to that hospital and that each hospital was dominant in its own market. The DG found alleged abuse of dominance from 2015 to 2018 on five parameters: room rent, medical tests, medical devices, consumables, and medicines. According to the DG, hospitals charged higher prices than hotels, standalone diagnostic centres, and procurement prices, while also earning significant profit margins.
