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20/10 23 February 2010
The OFT has today issued a Statement of Objections alleging that Reckitt Benckiser abused its dominant position in the market for the NHS supply of alginate and antacid heartburn medicines.
The OFT alleges that Reckitt Benckiser sought to restrict competition to its Gaviscon brand by withdrawing and de-listing its NHS packs of Gaviscon Original Liquid from the NHS prescription channel.
Where a patent has expired and a 'generic name' has been assigned, GPs can use their prescribing software to search for a well-known branded product and then provide patients with an 'open' prescription that lists its generic name. Pharmacies that receive these prescriptions can choose whether to dispense the relevant brand or equivalent but cheaper generic medicines. This choice provides for strong price competition between pharmaceutical suppliers and results in considerable savings to the NHS.
The OFT alleges that the withdrawal of NHS packs of Gaviscon Original Liquid from the NHS prescription channel was deliberately timed to occur before the publication of the generic name for this product so that when GPs search for 'Gaviscon' prescription packs they will identify Gaviscon Advance Liquid, which is patent protected, and not Gaviscon Original Liquid, for which an 'open' prescription could otherwise be provided.
No assumption should be made at this stage that there has been an infringement of competition law. The OFT will not be in a position to decide if the law has been breached until it has received and reviewed Reckitt Benckiser's response to the Statement of Objections and any comments from interested third parties.
Simon Williams, Senior Director for Goods at the OFT, said:
'This case raises significant and complex competition issues relating to the supply of prescription drugs to the NHS. Reckitt Benckiser will now have a full opportunity to respond to our proposed findings before we decide whether competition law has in fact been infringed.'
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