Asda told to raise price of drugs
Wednesday 25 October 1995
Asda, the supermarket group leading the challenge against resale price maintenance, has been served with an injunction by two pharmaceuticals groups to prevent it from selling vitamins and minerals at cut prices.
The group lost part of its battle yesterday when a court ruled that from 4pm today eight of the discounted lines will return to the resale maintenance price, an increase of 25 per cent. The two companies involved are Roche Pharmaceuticals, which makes Sanatogen, and Seven Seas which produces the Seven Seas range of vitamin supplements.
A wider injunction was thrown out but the two parties are due in court again next Thursday for a further hearing to decide the price level of the 70 remaining lines which are the subject of dispute.
Tony Campbell, Asda's trading director, said: "We continue to fight to bring better value vitamins, minerals and supplements to our customers. We also urge the Office of Fair Trading to speed up their investigations of this outdated price-fixing agreement."
The injunctions follows Monday's action by Procter & Gamble, Warner Wellcome and Reckitt & Colman which threatened legal proceedings if Asda extended its discounting policy to their products.
Asda expressed disappointment the drugs firms had resorted to solicitors' letters before speaking to the group.The group mounted its challenge to the resale price maintenance of non-prescription drugs last week when it cut the price of 80 vitamins and mineral products by up to 20 per cent.
Boots and Sainsbury's have already responded with some price cuts, though a full-scale price war has not yet been threatened.
The mediations battle follows Asda's successful challenge to the Net Book Agreement which collapsed last month.
Asda is also supportive of Tesco's threat to spark a magazine price war if the industry's distribution and wholesaling arrangements are not made more flexible.
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