May 09, 2008, 13:00
The Competition Commission slapped SA's largest supplier of hospital products, Adcock Ingram, with a R53-million fine today, the highest penalty in local history for collusive behaviour.
Adcock Ingram Critical Care, owned by Tiger Brands Limited, admitted to its "involvement in a cartel" and agreed to an administrative penalty of 8% of its turnover, the commission said in a statement.
"The penalty amounts to R53,502,800. In percentage terms, this is the highest penalty to date for collusive behaviour," it said. The fine is related to a cartel operating in the medical market for the supply of intravenous medical products to hospitals.
Adcock Ingram Critical Care colluded with other medical suppliers and "discussed and agreed on prices prior to the submission of their respective tenders" to hospitals between 1993 and 2007.
Upset and embarrassed
"The parties also agreed that whenever tenders were not awarded as agreed or arranged between them, the winning firms would cede portions of their business to one or other of the losing firm in certain proportions," the commission said.
Tiger Brands, in a statement to shareholders, said: "The... allegations of collusive tendering and market allocation made in the complaint referral against AICC were substantially correct."
It added that its CEO, Peter Matlare, said the company was "extremely upset and embarrassed about the situation and appropriate disciplinary measures will be taken."
Tiger Brands will hold a press briefing on the matter at 2pm in Bryanston, Johannesburg today. - Sapa
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