Foreseeing no threat to competition, UOKiK has cleared BRL Center-Polska, Cefarm Warszawa and Value Pharmacy to move ahead with separate takeover bids.

In 2009, Poland’s Office of Competition and Consumer Protection (UOKiK) commissioned research on the country’s pharmaceuticals market. When analysing acquisitions in the pharmaceutical market, UOKiK assumes that the area where pharmacies compete with each other is the distance within 1 kilometer of pharmacies belonging to companies to be acquired. This is because consumers choose pharmacies in the neighbourhood where they live, work or go to school, and generally walk to them. Those who drive do so primarily because there is no pharmacy in the neighbourhoods they live in or frequent.  

Pharmaceutical law in Poland does not permit a company to set up a new pharmacy if it, entities which it controls or a capital group which controls it run more than 1% of pharmacies in a given voivodship. Antimonopoly law, on the other hand, assumes that if an enterprise has a 40 percent market share, it has a dominant position. UOKiK approves a concentration if competition will not be limited on a given local market and consumers will not lose their ability to choose a pharmacy.

In the light of these distinctions, UOKiK has recently cleared three acquisitions in Poland’s pharmacy space. In the first, BRL Center Polska, which operates pharmacies under the Dr. Max brand, will acquire pharmacies belonging to the company Medea Holding, a chain of stores spread across separate geographic markets to such an extent that the Authority anticipates no threat to competition on any of the local markets to be involved.

In another application, Cefarm filed for permission to acquire Gama Farmacia. A retailer of pharmaceutical products and provider of logistics, Cefarm is a subsidiary of Farmacol, which in addition to retail operations is also a wholesaler of pharmaceutical products. UOKiK’s proceeding in the case revealed that the transaction will not reduce competition: while both companies run general pharmacies, they are located on separate geographic markets. In addition, Farmacol’s share of the pharmaceutical product delivery market in voivodships where the pharmacies its Cefarm subsidiary is to take over are located, has not exceeded 30%.

Finally, Value Pharmacy is owned by private equity funds, which together form the Warburg Pincus Group, owner of 120 companies which operate across a range of markets. Having received UOKiK’s approval, Value Pharmacy will take over pharmacies operating under the Gemini name — seven independently and another 26 together with a holding, OKGEM, created expressly for the transaction.  

Additional information for the media:

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