Updated: Aug 21
For immediate release
19 August 2020
Health Justice Initiative (hji) and Open Secrets admitted as joint amici (friends of the court)
in Competition Appeal Court - involving Dis-Chem & the Competition Commission (pricing of face masks for COVID-19)
On 11 August 2020, the Health Justice Initiative (hji) and Open Secrets jointly sought admission from the Competition Appeal Court (CAC) as amici (friends of the court) in a matter involving an appeal brought by Dis-Chem Pharmacies (Pty) Ltd (Appellant) and the Competition Commission (Respondent) against a decision of the Competition Tribunal. See: https://www.comptrib.co.za/casedetail/9112
On 7 July 2020, the Competition Tribunal of South Africa found Dis-Chem guilty of charging excessive prices for three types of surgical face masks to the detriment of consumers during March 2020.
Dis-Chem was fined R1 200 000.00. In its judgment, the Competition Tribunal found:
“… the exploitative conduct of Dis-Chem of excessive pricing was particularly reprehensible. It exploited customers desperate to lay their hands on an essential item in the fight against a pandemic of global proportions, with potential consequences for consumers and public health…To this end we consider its conduct was not only exploitative of vulnerable consumers, especially the poor, but was especially egregious”.
The appeal concerns the interpretation of Section 8 of the Competition Act and the Customer Protection and National Disaster Management Regulations and Directions, in the context of a pandemic, and in light of the levels of social and economic inequality in South Africa. The decision of the CAC in this appeal will be of great and widespread significance. It will have ramifications not only for the pricing of masks, but for the pricing of essential medical supplies, including treatment and vaccines in the future.
On 14 August 2020, the Health Justice Initiative (hji) and Open Secrets were admitted as joint amici by the CAC and will be submitting its arguments shortly. The Health Justice Initiative (hji) and Open Secrets have also requested that the CAC admit the evidence of its experts in the matter, and this request will be argued on the date of the e-hearing of the appeal, scheduled for 4 September 2020, when the court will make its determination thereon.
The Health Justice Initiative (hji) and Open Secrets have submitted in their arguments that it is essential that evidenced-based and constitutionally-aligned jurisprudence be developed regulating issues such as potential profiteering, gouging and anti-competitive behaviour in the context of a pandemic - and that the current global pandemic and public health crisis disproportionately affects poor and vulnerable members of our society.
In this matter the Health Justice Initiative (hji) and Open Secrets are represented pro bono, by Webber Wentzel Attorneys and Advocates Phumlani Ngcongo; Frances Hobden and Cingashe Tabata at the Johannesburg Bar.
For Immediate Release
21 August 2020
On 16 July 2020, the Health Justice Initiative – hji – and Ezintsha (WITS University) jointly referred a medicine pricing matter to the Competition Commission for examination and review.
Given the COVID-19 pandemic at hand, and reports of excessive pricing of key medical supplies, hji and Ezintsha asked that the Commission look into the price of a medicine that early clinical evidence suggest could be used in the treatment of very ill patients with COVID-19 over time: remdesivir (a drug on patent, with a handful of generic licensees for South Africa). Separately, there are also intellectual property (patent) issues that the South African government will have to address with Gilead Sciences, the patent holder, that we will be raising too.
In July, the hji and Ezintsha requested that the Competition Commission fully examine the basis of the prices being charged by all suppliers of remdesivir including any generic licensees of remdesivir for South Africa (especially in the event that it is approved for clinical use by South African regulatory authorities) in both the public and private sectors.
hji and Ezintsha shared international price comparisons and other information with the Competition Commission that suggest that in certain instances, the prices charged do not necessarily correlate with available input costs, nor are they affordable in a time of a pandemic.
We have also urged the Competition Commission to engage in preemptive price regulation for any COVID-19 life-saving diagnostics, vaccinations and therapeutics because of the health and other rights guaranteed by our Constitution; the limitations and incompleteness of the current medicine pricing regime in South Africa, and because we are in the middle of a pandemic, which requires extraordinary regulatory and other measures.
We are confident that the Competition Commission will work with all relevant companies and stakeholders, including the national Department of Health, in the event that public and/or private sector procurement needs to take place in the next few months.
Lives may depend on it.