Pharmacies forced to pay fines and donate PPE after 'astronomical' price gouging


112 days ago

The National Consumer Commission (NCC) has reached a settlement agreement with Mopani Pharmacy in Mpumalanga and People’s Pharmacy in KwaZulu Natal.

The two independent pharmacies have been found guilty of excessive price increases (price gouging) on hand sanitisers as well as facial masks.

These items are essential in curbing the spread of Covid-19.

The NCC's Director of Prosecutions, Joseph Selolo, says the mark-up on the items was astronomical.

RELATED: 'We saw Dis-Chem price hikes of 43 -45% and importantly a rise in gross margins'

An investigation revealed that Mopani Pharmacy made a profit of 179% on facial masks while People’s Pharmacy
made a profit of 74.72%.

The NCC has charged the suppliers with contravening Sections 40 and 48 of the Consumer Protection Act (CPA) read with Regulations 350 by unfairly increasing their prices.

In terms of the agreement, Mopani Pharmacy is required to pay an administrative penalty of R52 700 while People’s Pharmacy will pay an administrative fine of R10 000.

RELATED: Dedicated team to fast-track investigation and prosecution of price hikes

The Commission has ordered Mopani Pharmacy to donate 2,500 units of reusable facial masks to a non-profit organisation in Mpumalanga and People’s Pharmacy must donate personal protective equipment (PPE) to the value of R20 000 to two non-profit organisations in KZN.

Both suppliers have also agreed to desist from engaging in a conduct that violates any provision of the CPA.

The price gouging relates to the mark-up.

Joseph Selolo, Director of Prosecutions - National Consumer Commission

The law says a price is unreasonable, unfair and unjust if there is no other factor justifying it.

Joseph Selolo, Director of Prosecutions - National Consumer Commission

You're procuring your goods for the same price, however, you've increased your price when there's nothing that has changed. That price is unfair.

Joseph Selolo, Director of Prosecutions - National Consumer Commission

In these specific cases, the mark-up that they added to their prices was astronomical. It led to them making certain profits that they shouldn't have made.

Joseph Selolo, Director of Prosecutions - National Consumer Commission

Listen to the latest developments on Today with Kieno Kammies:

This article first appeared on CapeTalk : Pharmacies forced to pay fines and donate PPE after 'astronomical' price gouging

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