DAGESTAN PHARMACEUTICAL COMPANIES FORMED A CARTEL

The antimonopoly case was opened upon the outcome of inspections in Dagestan

On 4 February 2019, FAS found that “Regionpharma” Ltd., “Globalmedtech” Ltd., “Dagmedtechnika” Ltd. and “Medpharmasnab” Ltd. are guilty of concluding a cartel (Clause 2 Part 1 Article 11 of the Federal Law “On Protection of Competition”), which resulted in maintaining prices in the course of competitive bidding for supplies of medicines and medical products, rendering services for repair and maintenance of medical products for medical facilities and Dagestan Ministry of Healthcare in 2015 -2018.

Dagestan Ministry of Healthcare, “Republican Specialized Early Treatment Centre of Oncology”, Regionpharma” Ltd., “Globalmedtech” Ltd., “Dagmedtechnika” Ltd. and “Medpharmasnab” Ltd. are found guilty of concluding an anticompetitive agreement between the ordering party and a bidder (Clause 2 Part 1 Article 17 of the Federal Law “On Protection of Competition”).

According to FAS estimated the cartel revenue exceeded 2 billion RUB.

The FAS decision on the case will be sent to the Investigation Department of the Ministry of Interior of the Russian Federation to include in the file of the criminal case, where one of the accused is a former Dagestan Healthcare Minister Т. Ibragimov. The government official and his son-in-law – General Director of “Medpharmasnab” Ltd.  are suspected of creating an organized criminal group – a cartel stealing budgetary funds in public procurement for supplies of medications and medical equipment for the needs of medical facilities in Dagestan through overrated prices.

“Cartels in healthcare and providing medicines to the population are most painful, both for the budget and the population of the Dagestan Republic. The state constantly allocates additional funds for the social sphere that are used “on cartels” instead of development, and budgetary money are wasted instead of saved because of anticompetitive agreements with the ordering parties at biddings. Cartel members are not concerned at all about the quality of the procured products. As a result all this has an extremely adverse effect upon the industry and the levels of services to the population”, pointed out Stats-Secretary, Deputy Head of FAS Andrey Tsarikovskiy.