'JW Shinyak' Handling Obesity Treatment Drugs with Unfair Rebates to Hospitals... Fair Trade Commission Imposes Surcharge
[Sejong=Asia Economy Reporter Joo Sang-don] JW Shinyak, which provided unfair rebates worth about 800 million KRW to hospitals and clinics to increase prescriptions of its obesity treatment drugs, will be sanctioned by the Korea Fair Trade Commission (KFTC).
On the 7th, the KFTC announced that it decided to issue a corrective order and impose a fine of 240 million KRW on JW Shinyak.
JW Shinyak handles a total of 18 obesity treatment drugs, including the appetite suppressant Pentermi. In the overall market, products such as Novo Nordisk's Saxenda (42.6 billion KRW), Daewoong Pharmaceutical's Dietamin (9.5 billion KRW), and Huons' Hutermin (6.2 billion KRW) rank high in sales.
According to the KFTC, from January 2014 to April 2017, JW Shinyak provided unfair rebates worth about 800 million KRW to 90 hospitals and clinics nationwide with the purpose of increasing or maintaining prescriptions of its obesity treatment drugs.
They made agreements with each hospital and clinic for a certain amount of prescriptions and, in return, provided economic benefits (cash, goods support, etc.) in advance equivalent to a certain percentage (20?35%) of the agreed prescription amount. JW Shinyak managed compliance by checking whether the prescriptions were made as agreed after the advance support, and if the hospitals or clinics did not prescribe as agreed, they delayed new agreements or lowered the advance support rate.
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A KFTC official stated, "This measure will contribute to correcting the competitive order and protecting consumer interests by strictly addressing unfair rebate provision practices in the prescription drug obesity treatment market. The KFTC will continue to strengthen monitoring of acts that undermine competition through rebates in the pharmaceutical market and will strictly sanction any violations of related laws in accordance with principles."
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