SEOUL, March 18 ((Yonhap) — South Korea’s anti-trust watchdog said Thursday that it has decided to fine local large-sized general hospitals a combined 550 million won (US$486,725) for abusing their market power over pharmaceutical companies, Yonhap news agency reports.
Subject to the fine are Catholic Medical Center and Yonsei University Health System, which will have to pay 300 million won (US$265,250) and 250 million won (US$221,042), respectively, according to the Fair Trade Commission.
Two other hospitals — Seoul National University Hospital and Ajou University Medical Center — were also given a “corrective order” not to engage in such unfair business practices again.
The four were accused of abusing their market power by pressuring pharmaceutical companies to donate money for their purchases of land and the construction of buildings.
The hospitals received around 24.1 billion won (US$21.3 million) between March 2005 and May 2008, the watchdog said.
The watchdog expects that its decision will discourage large-sized general hospitals from engaging in such unfair practices in the future. It is also expected to induce investments in drug development and help stabilize overall drug prices.
The FTC has been intensifying efforts to establish a fair competition environment in the medical industry by cracking down on rebate practices. Such efforts are aimed at enhancing transparency in transactions and the price-setting process in the medical industry in order to lower drug costs.
– NNN-BERNAMA
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