Uniphar and Navicorp filed three sets of remedies to CCPC before deal blocked

Dublin-listed Uniphar, whose planned takeover of pharmacy solutions company NaviCorp was blocked by the Competition and Consumer Protection Commission (CCPC) in December, failed to alleviate competition concerns about the tie-up in three sets of remedies presented to authorities.

A final, 391-page report on the decision, published on Monday, said the parties submitted a first set of draft remedies on October 3rd, but were told a month later that the proposals, which were heavily redacted in the report, would not ease concerns that the deal would substantially lessen competition in markets for services in the State.

A second set of draft proposals was submitted on November 11th, with a third filed on December 14th, a day before the CCPC announced that it was blocking the deal, in the first such move by Irish competition authorities in more than a decade.

The final package was only presented two days before the CCPC faced a statutory deadline to issue its decision and the authority disagreed with Uniphar and NaviCorp’s view that the third set of remedies did not need to be tested in the market.

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“The commission did not have sufficient time to assess whether the third draft proposals ameliorate the competition concerns, including carrying out the necessary market testing,” the report said. “Therefore, the commission was not in a position to take the third draft proposals into account as part of the basis of its determination.”

The CCPC, first notified of the planned purchase in December 2021, received only one submission from a third party in relation to the proposed deal when it was carrying out an initial assessment, before launching a full-scale phase-two scrutiny of the transaction, according to the report.

However, it held calls with a number of third-party stakeholders, ranging from pharmaceutical wholesalers and retailer representatives to the Health Products Regulatory Authority. No third-party submissions were received during the second phase, which started last April.

The CCPC decided the deal would have substantially hit competition in the market for the provision of buying group services. Buying groups negotiate directly with manufacturers for discounts and supply times for member pharmacies. Uniphar’s LinkUp and LinkUp Gold buying groups are rivals of NaviCorp’s Axium unit.

[ Uniphar records strong performance as it hits the acquisitions trail ]

[ CCPC to take in depth look at Uniphar's aquisition of Navicorp ]

The authority also concluded that the purchase would substantially affect competition for the provision of common management and branding services through their respective pharmacy symbol group. Symbol group services include branding and store design, marketing, business intelligence and reporting, procurement, HR management, IT management, accounting.

In this segment of the market, Uniphar’s Allcare and Life Pharmacy symbol groups compete with Navicorp’s StayWell and CarePlus businesses.

Less than a month after the CCPC blocked the Navicorp deal, it allowed Uniphar add to its chain of pharmacies with the purchase of the Sam McCauley network of 37 outlets. However, Uniphar agree to sell three pharmacies, in counties Kildare, Meath and Wexford to ease competition concerns.