War between Sicomed and Romanian authorities

The dispute started between the main Romanian drugmaker Sicomed Bucharest and the authorities, after the former decided to stop the production of 50 drugs, seems to be turning into a war.

Health minister Daniela Bartos ordered that 500,000 vials of Algocalmin (pain relief) and Xilina (anaesthetic) should be taken from the special reserves and delivered to hospitals and several public drugstores.

Sicomed had previously decided to stop producing 50 types of injectable drugs saying that it could not cover the losses generated by the authorities’ refusal to approve the price increases requested by the company.

Sicomed covered almost the entire domestic need for injectable vial-bottled drugs and announced it would not resume production.

In her turn, Daniela Bartos said she would manage to meet domestic demand with imported drugs and with the drugs produced by other domestic manufacturers, thus breaking Sicomed monopoly.

The Health minister was to meet in Bucharest with the managers of several drug plants, such as Terapia Cluj and Europharm Brasov, in order to discuss about the possibility to take the production of the 50 drugs elsewhere.

“I do not think that imports from the Republic of Moldova and the other domestic producers will be able to provide the necessary amount of injectable vial-bottled drugs in the long term. They will eventually have to resort to Sicomed,” said Ladislau Randjak, member of the company’s Management Board and representative of a significant shareholder.

As the Sicomed scandal amplifies, the Competition Office says that the company’s decision to halt production “may be considered an unfair competition practice, which is sanctioned by the law.”

Competition Law 21/1996 forbids a company to abusively use its dominant position on the market in order to directly or indirectly impose the sale prices, to reduce output to the loss of consumers and to exploit a client’s economic dependence on an economic agent.

“Sicomed, through the monopoly it currently holds, may artificially trigger a crisis on the market of injectable drugs, in order to increase and impose the prices, to the loss of the consumers,” the Competition Office said.