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On 10 January 2025, the Serbian Commission for Protection of Competition ("CPC") announced it has opened an inquiry into the pharmaceutical sector.
The inquiry deals with human medicines with a focus on prescription (Rx) medicines financed by the Serbian Health Insurance Fund. The goal of the inquiry is to assess how prices of medicines are formed and what the competitive conditions on the market are, including market shares, vertical relations and any entry barriers. As part of the inquiry, the CPC has already started sending out questionnaires to larger pharmacy chains.
The inquiry does not come as a surprise – the Serbian Prime Minister expressed his concerns about pharmaceutical market margins and announced an inquiry into pricing practices in this sector back in October 2024; the inquiry also comes after the recent CPC’s decisions on exclusive distribution arrangements in the pharmaceutical sector, where the CPC showed a somewhat stricter approach towards the relevant market definitions which ultimately lead to rejections of individual exemption requests. Another incentive for the inquiry could also be the ongoing consolidation of the market at the retail level, with bigger pharmacy retail chains actively acquiring their smaller counterparts in the last few years which can generally lead to and/or allow price collusion and thus higher margins.
Going forward, companies active in the Serbian pharmaceutical sector should consider that:
- Sector inquiries are typically opened when the CPC has concerns with respect to the way the market functions and suspects potential antitrust violations. Given the Prime Minister’s announcement from October 2024, this inquiry could indeed be signalling potential competition concerns in the Serbian pharmaceutical sector, such as vertical or horizontal price fixing and/or market foreclosure due to exclusivity or similar arrangements.
- Within sector inquiries, the CPC gathers commercially sensitive information from the market participants. Questionnaires typically include requests for copies of agreements (with suppliers/buyers) and other commercial documentation and data (incl. on price changes in the past period).
- Sector inquiry findings frequently lead to investigations against market players suspected of antitrust rules’ breaches.
