Business Intelligence on Retailing, Franchising, and Consumerism in China

Sichuan Drug Retailers Punished For Illegal Pricing

Sichuan Provincial Pricing Department has issued a warning to 19 drug retailers who reportedly were involved in illegal pricing.

This is the first case of price collusion that SPPD says it has uncovered in the past 20 years.  SPPD has asked the retailers to stop their illegal behavior.

The 19 drug retailers include Hua'antang, Kangbei and Ben Cao Tang and they together occupied about 90% of the drug retail market in Chengdu. Headed by Chengdu Municipal Chamber of Commerce for Drug and Medicine, these companies participated in and colluded to set drug prices to manipulate the price of the drug market.

Zhang Changgui, a team leader from SPPD who is responsible for investigating on the case, says that SPPD and Chengdu Municipal Pricing Department jointly conducted a series of audits from September 28 to mid-October, which finally verified that the companies had engaged in illegal pricing. Apart from being asked to stop the illegal behaviors in pricing, the concerned companies have been asked to make a public apology to consumers.

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