Competition Authority’s Powers over Regulated Markets: considerations under Cade’s case law in pharmaceuticals

Abstract

This article reviews Brazilian competition case law agency regarding the pharmaceuticals. In Brazil, manufacturing, distribution and commercialization of medicines are highly regulated, including prices. In such strictly regulated market is there still room for antitrust enforcement by competition authorities? We start presenting an overview of the observed market failures in pharmaceuticals, the applying federal regulation, especially regarding price caps. Then, we take on Cade’s case law on anticompetitive practices of abusive pricing, predatory pricing and collusion, and its practices on merger review. By comparing both, we conclude that, on the one hand, sector regulation may prevent some potential anticompetitive practices. On the other hand, Cade has punished companies for cartel practices and imposed restriction on mergers, which show that competition authorities still have an important role to play in this market.