Sigma and Chemist Warehouse Merger Greenlighted by ACCC

The Australian Competition and Consumer Commission (ACCC) has announced that it does not oppose the proposed merger between Sigma Healthcare Limited and Chemist Warehouse, citing that the merger is unlikely to substantially lessen competition across the pharmacy supply chain, both nationally and locally. ACCC Chair Gina Cass-Gottlieb stated that competition would continue at all levels, with consumers having a choice between different pharmacy offerings, including smaller, personalized stores and larger discount formats. Competition is maintained due to existing pharmacy and non-pharmacy retailer competition, and the presence of major wholesalers like API, EBOS, and CH2, which can support new pharmacy retail customers. To address any potential issues, Sigma has given undertakings ensuring pharmacies can switch wholesalers without barriers, maintaining a competitive landscape. The ACCC's extensive review included analysis of internal documents from both entities and concluded that significant competitive constraints still exist. Certain contractual and data usage restrictions have also been addressed to facilitate easy switching for pharmacies currently under Sigma. The merger will sustain the landscape of pharmacy retailing without significantly impacting market dynamics, as supported by the ACCC's findings.