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The UK Competition Authority holds abusive below-cost pricing in the pharmaceuticals sector (Napp)

The OFT and CCAT found that the impact of Napp's below-cost hospital pricing extended beyond the hospital segment because a brand's sales in the hospital market were linked to outcomes in the community market. By denying competing brands access to hospital In any standard economics textbook the description of monopoly shows a supplier who has the power to raise price above costs in order to earn profits in excess of the normal or competitive level. The textbook monopolist restricts output in order to create an artificial scarcity for its product, and this causes the welfare losses arising from monopoly abuse. Most economists would readily agree that public policy ought to be capable of dealing with excess pricing. This is most starkly seen in the regulation of privatised natural

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  • Competition Appeal Tribunal (London)

Quotation

Derek Ridyard, The UK Competition Authority holds abusive below-cost pricing in the pharmaceuticals sector (Napp), 30 March 2001, e-Competitions Healthcare, Art. N° 21109

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