Background

On November 30, 2023, the CCI dismissed a Complaint filed by Nadie Jauhri (‘Informant’) against Lupin Ltd. (‘Lupin’) and Dr. Reddy’s Laboratories Ltd. (‘Dr. Reddy’s’) (collectively ‘Opposite Parties’) alleging contravention of Sections 3 and 4 of the Competition Act. ^[1]

Allegations

The Informant made inter alia the following allegations:

i.    Lupin’s procedure of refusal to supply products of Lupin to a wholesaler i.e., M/s Indira Medical Agencies, to be in violation of the Drug (Price Control) Order, 2013 issued under Section 3 of Essential Commodities Act, 1965. Such policies of imposing dictates over wholesalers do not allow healthy Competition; and

ii.   Reddy’s issued a letter of appointment to Shah Agencies, Nashik (‘Shah Agencies’) to become its stockist but was not able to implement the agreement and turned down Shah Agencies because they failed to obtain a NOC and voluntary contribution for the local association. Instead, Dr. Reddy’s sent e-mails to their distribution head recommending Indira Medical Agencies, Nashik to be added as stockist.

Interim Relief: The Informant besides praying for stern action, cease and desist orders and imposition of penalty also prayed for interim relief under Section 33 of the Competition Act.

CCI’s Assessment

The CCI dismissed the complaint and closed the matter under Section 26(2) of the Competition Act (accordingly also denying the Informant’s prayer for interim relief) inter alia for the following reasons (primarily on account of lack of evidence):

i.    Allegations in Relation to Inter Alia Essential Commodities Act: The CCI observed that the evidence submitted by the Informant for its allegation of violation of Essential Commodities Act by Lupin was prima facie not sufficient to substantiate a contravention under Sections 3 or 4 of the Competition Act. The CCI also noted that certain allegations raised qua misbranding and selling of expired goods does not fall under the purview of the Competition Act;

ii.   Lack of Evidence to Demonstrate Anticompetitive Conduct: The CCI also noted that with regard to the Informant’s allegation regarding Lupin’s policies being anti-competitive, the evidence submitted by the Informant did not prima facie relate to any contravention of the Competition Act by Lupin. Further, the CCI noted that the evidence in form of internal emails submitted by the Informant do not substantiate the said allegation of non-supply of drugs to Indira Medical Agencies for want of NOC and voluntary contribution to the local association; and

iii.  Lack of Evidence: Even with respect to the allegations against Dr. Reddy’s, the CCI noted that the Informant has not adduced any evidence of non-implementation of the agreement between Shah Agencies and Dr. Reddy’s or non-supply of drugs to Shah Agencies. In this regard, the CCI noted that the evidence in form of internal emails submitted by the Informant do not substantiate the said aforesaid allegation.

[1] Nadie Jauhari v. Lupin & Ors., Case No. 23 of 2023.