Case Law Details
Pinesh S. Doriwala Vs Sanofi India Limited (Competition Commission of India)
CCI held that that no manufacturer or a distributor should withhold from sale or refuse to sell to a dealer any drug without good and sufficient reasons. In the instant case, no such refusal appears to have happened, as the OP has asked/requested SSNRDC to contact OP’s existing distributors for supply of its aforementioned pharmaceutical products. In this regard, the Commission also notes that the OP has appointed 17 distributors in Surat. Thus, prima facie, it appears that SSNRDC is free to obtain OP’s products from its existing distributors and the OP does not interdict, in any manner, its distributors from dealing with SSNRDC. However, SSNRDC in the absence of being appointed as a distributor does not appear to be entitled to procure the supplies at a wholesale price but only at a retail price, which according to the Informant defeats the purpose.
Further, SSNRDC requested the OP to accept its purchase order and supply pharmaceutical products at a wholesale price (price to stockiest). Some of the products for which the purchase orders were raised have been stated to be in relation to purportedly popular pharmaceutical products of the OP namely Allegra, Avil, Cardace, Combiflam, Lantus and Amaryl. The Commission in this regard notes that the drugs as aforementioned appear to have generics/ substitutes in the market which are sold by other manufacturers and the Informant is not foreclosed absolutely in dealing in such products.
The Commission further observes that the Informant, has not been able to demonstrate that non-dealing of the OP directly with the Informant has caused any AAEC or is likely to cause AAEC in the market, except the Informant getting lesser margins when not dealing directly with the OP for its products. In the instant case, the Informant has the option to approach other pharmaceutical companies offering similar drugs in respect of which the SSNRDC has been endeavouring to obtain wholesale licence from the OP. Further, as per the documents enclosed, it appears that the Informant is already engaged with some pharmaceutical companies such as Cipla Ltd., MSD Pharmaceuticals Pvt. Ltd., Sun Pharma, Abbot India, etc. in the capacity of a wholesaler. Thus, the Commission is of the prima facie view that the cases where refusal to deal is alleged, the same should be manifested to have or likely to have AAEC in the market in which the concerned party operates, to be held to be anticompetitive in terms of the provisions of Section 3(4)(d) of the Act read with Section 3(1) of the Act, in terms of adversely affecting intra-brand competition and/or inter-brand competition, as the case may be.
Further, the Commission observes that there must be some autonomy available to the manufacturers to deal with their goods the way they want, in alignment with their business requirements. Nobody can ask for an absolute right to deal with a particular business.
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