European Commission fines Alchem for involvement in API cartel

The European Commission has imposed a fine of €489,000 on Alchem International Pvt. Ltd. and its subsidiary Alchem International (H.K.) Limited for violating EU antitrust regulations. The Commission discovered that Alchem was involved in a cartel related to a significant pharmaceutical ingredient for more than 12 years.

In October 2023, the Commission issued a settlement decision and imposed fines totaling €13.4 million on six companies involved in the same cartel. Unlike the other cartel participants, Alchem chose not to settle with the Commission. Consequently, the investigation against Alchem continued under the standard cartel procedure, with the Commission sending a Statement of Objections to Alchem in June 2024.

Alchem is a producer of N-Butylbromide Scopolamine/Hyoscine (SNBB), a crucial material used to manufacture the abdominal antispasmodic drug Buscopan and its generic versions. The Commission’s investigation revealed that Alchem colluded to set a minimum sales price for SNBB to customers such as distributors and generic drug manufacturers. Additionally, Alchem engaged in the allocation of quotas and exchanged sensitive commercial information.

The investigation found that Alchem was involved in a continuous infringement in the European Economic Area (EEA) from November 1, 2005, to February 12, 2018. Teresa Ribera, Executive Vice-President for Clean, Just, and Competitive Transition, emphasized the significance of competition in ensuring affordable access to essential medicines, stating, “Our investigation demonstrated that Alchem, the only non-settling producer, unlawfully coordinated prices and quotas for over 12 years.”

This case marks the first time the Commission has penalized a cartel in the pharmaceutical sector related to an active pharmaceutical ingredient. The Commission collaborated with Swiss and Australian competition authorities on certain investigative activities.

Moving forward, it is clear that maintaining fair competition in the pharmaceutical industry is crucial for enabling affordable access to essential medicines. The actions taken against Alchem underscore the Commission’s commitment to upholding antitrust rules and protecting consumer interests.

Through its investigations and decisions, the European Commission aims to promote a competitive market environment that fosters innovation, affordable pricing, and equitable access to essential medications. The repercussions from this case serve as a reminder of the importance of adhering to antitrust laws to prevent anti-competitive practices that can harm consumers and undermine the integrity of the pharmaceutical industry.