Brocacef to acquire parts of rival Mediq under conditions

Dutch company Brocacef Groep N.V. (Brocacef) is allowed to acquire Mediq Apotheken Nederland and Mediq Pharma Logistics (Mediq) under strict conditions. This has been revealed by a decision of the Netherlands Authority for Consumers and Markets (ACM). Both Brocacef and Mediq run pharmacies and wholesale operations with pharmaceutical products such as prescription drugs. Brocacef is required to sell wholesale company Distrimed. In addition to that, the combined Brocacef/Mediq must hive off a total of 89 pharmacies. That way, hospitals and consumers will continue to have enough choice when purchasing drugs and other pharmaceutical products.

Pharmacies

There are almost 2,000 pharmacies in the Netherlands. After the acquisition, Brocacef would own approximately 600 wholly-owned pharmacies and associated pharmacies (franchisees and partners). Generally speaking, consumers choose a pharmacy in their neighborhood. In order to make sure that consumers will have sufficient choice between competing pharmacies in their neighborhoods (or at least close to their homes), 89 pharmacies of Brocacef/Mediq (38 wholly-owned pharmacies and 51 associated ones) must change hands.

Health insurers, too, have an interest in pharmacies belonging to different competitors. They need to conclude contracts for their customers, so that they are able to choose a pharmacy near their homes. If there are too many areas where just a single pharmacy chain is active, that chain will have a stronger position vis-à-vis health insurers. That could have negatives effects on consumers, as prices might increase. That is the second reason as to why pharmacies of Brocacef/Mediq need to change hands.

Drug wholesalers

At the moment, Brocacef and Mediq each own a wholesale company that is able to supply hospitals with a full range of drugs. Three such wholesale companies are active in the Netherlands. After the acquisition, that number would drop to two, thereby eliminating an important option for hospitals. In order to safeguard competition between wholesalers that supply hospitals, Mediq’s wholesale company (Distrimed) will be sold to Pluripharm Groep B.V. Pluripharm already owned a wholesale company, but it had not supplied hospitals yet. With this sale, three wholesalers continue to be active in the market, thereby ensuring that hospitals will continue to have enough to choose from.