The CMA’s first strike against pay for delay settlements in the United Kingdom

February 12, 2016

(By Sven Gallasch) On 12 February 2016 the Competition and Markets Authority (CMA) issued its first infringement decision concerning so-called pay for delay settlements in the UK pharmaceutical market, imposing a fine of £ 44.99 million on the branded pharmaceutical company GlaxoSmithKline plc (GSK) and a number of generic pharmaceutical companies including Generics (UK) limited and Alpharma Limited. This blog post considers whether drug companies’ claims that this practice is actually beneficial to customers have any merit. Read the rest of this entry »


Unfair purchasing practices and the Groceries Code of Conduct: the Tesco investigation

February 1, 2016

By Ignacio Herrera Anchustegui (University of Bergen). On 26 January 2016 the Groceries Code Adjudicator made public its investigation into Tesco plc concerning the possible breaches of the UK Groceries Code of Conduct. After an almost yearlong investigation the Adjudicator determined that Tesco had engaged in unfair purchasing practices prohibited by the Groceries Code of Conduct (“the Code”) by delaying payments that were due to its suppliers. Although the Adjudicator did not impose any financial fine on Tesco, it did issue five recommendations to be followed by the supermarket retail chain in order to prevent payment delays in the future. This blog discusses the Tesco case and its implications for future investigations. Read the rest of this entry »


BT/EE Merger: the importance of market definition

January 20, 2016

(by Richard Cadman) Last Friday, the Competition and Markets Authority (CMA) gave unconditional approval to the acquisition by BT, the UK’s largest fixed telecommunications provider, of EE, its largest mobile communications provider.  The CMA concluded, after a nine-month long investigation, that the merger would not lead to a Substantial Lessening of Competition (SLC) and that neither the wholesale nor retail customers of both companies would suffer any harm from the merger.  How much did this depend on product market definition? Read the rest of this entry »


New Zealand Rejects Cartel Criminalization for the Wrong Reasons

December 9, 2015

(by Andreas Stephan) Yesterday the New Zealand government announced it would drop plans to criminalize cartel conduct on the grounds that it would have a chilling effect on pro-competitive behaviour. While there may be good reasons to reject the criminalization of cartel conduct, this is probably the least convincing. Read the rest of this entry »


The VW Diesel Scandal: Turning a Blind Eye on Emissions to Protect the European Automobile Industry

October 16, 2015

(by Eugenio Miravete[1]) VW stands accused of exceeding the US EPA’s NOx standards by a factor of 10 or up to 40. What makes VW’s deception especially culpable is a sophisticated device designed to instruct the engine to run on clean mode when it detects that the vehicle is under lab testing conditions. Outraged commentators compare this to the behavior of the financial industry that led to the 2008 crisis. How did VW come to this? A significant part of the answer can be found in my own research, though this was not the issue I was investigating at the time. Read the rest of this entry »


The Economics of a $750 Pill

September 23, 2015

(by Farasat Bokhari) On Monday morning, the New York Times broke the story about a price hike in the USA from $13.50 to $750 per pill for Turing Pharmaceuticals’ drug Daraprim. Hillary Clinton tweeted, “Price gouging like this in the specialty drug market is outrageous. Tomorrow I’ll lay out a plan to take it on. –H”. Since Clinton’s plan is likely to include negotiated prices between pharma and Medicare, this in turn sent the Nasdaq Biotechnology Index down by 4.7% within the next two hours (see the Bloomberg graph below). Beyond the political repercussions, how can it suddenly be profitable to impose such an enormous price rise for an out-of-patent drug? Read the rest of this entry »


Would Jeremy Corbyn as Prime Minister mean the end of Competition Policy?

August 17, 2015

(by Andreas Stephan) The UK’s Labour party is currently in the process of selecting a new leader. The front-runner, Jeremy Corbyn, may become Britain’s first socialist Prime Minister in a generation. This blog post considers what a Corbyn government could mean for competition policy. Read the rest of this entry »


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