A merger between Chemist Warehouse and Sigma Healthcare is unlikely to substantially reduce competition in the pharmaceutical industry, a watchdog has concluded.
The competition watchdog has approved the $8.8 billion merger of pharmaceutical companies Chemist Warehouse and Sigma Health after deciding it will not hinder consumer choice.
Chemist Warehouse, a pharmacy franchisor, can now combine forces with pharmaceutical wholesaler Sigma Healthcare, following the Australian Competition and Consumer Commission (ACCC) verdict.
Sigma is also a pharmacy franchisor under brands such as Amcal+ and Discount Drug Store.
“The ACCC’s analysis found that the proposed merger is unlikely to substantially reduce competition at a national or local level because other pharmacies and non-pharmaceutical retailers will continue to compete to the same extent they compete now,” chair Gina Cass-Gottlieb said. .
Consumers value different aspects of the two companies’ core brands, he added.
“Importantly, consumers will continue to be able to choose between smaller format stores that offer personalized services to consumers and the Chemist Warehouse offering, focused on larger format discount stores and front-of-store offerings,” he said.
The ACCC has approved the $8.8 billion merger of pharmaceutical companies Chemist Warehouse (pictured) and pharmaceutical wholesaler Sigma Health.
The impact of the proposed merger on the supply of retail pharmaceutical products, including generic drugs, was also considered.
The ACCC concluded that there were multiple channels available for suppliers and manufacturers of these products to reach consumers.
The Pharmacy Guild, an industry lobby group, had opposed the merger on competition grounds.
