Under Article 102 of the Treaty on the Functioning of the European Union (“TFEU”), an undertaking may abuse its dominant position by “directly or indirectly imposing unfair purchase or selling prices.”
Interesting legal case commenced in 2016 re excessive and unfair pricing involving a Pfizer drug.
Complex legal case - may be of relevance more broadly to charges for both vaccinations and testing inoculations.
Strict criteria apply re establishing a fair price - two approaches are given - cost plus or competitive context.
"The UK Competition and Markets Authority (CMA) concluded that the prices were excessive because they exceeded the Cost Plus benchmark, as the ROS for both parties throughout the relevant period was significantly above 6%. Further, it found that the prices were also unfair “in themselves” because they had no reasonable relation to the economic value of the capsules which was not higher than their cost of production plus a 6% ROS (i.e., the Cost Plus benchmark)."
Judgement taken to appeal.
The European Court of Justice (ECJ) held in its judgment that a price can be considered excessive when it has “no reasonable relation to the economic value of the product supplied”.
The ECJ stated that the excessive nature of a price could be determined “inter alia” based on the following two-limb test:
the price must be “excessive”, which is the case when the difference between the cost of production and the selling price of the product is excessive (“excessive limb”); and
the price must be “unfair” either (i) in itself or (ii) when compared to competing products (“unfair limb”)
For further info
https://www.covcompetition.com/2020/05/ ... s%E2%80%9D.