Seoul, December 3 (IANS). South Korea’s antitrust regulator said on Tuesday it has fined leading drugmaker Celltrion 435 million won ($309,900) for engaging in unfair trade practices.
According to the ‘Fair Trade Commission’ (FTC), the biopharmaceutical giant is accused of unfairly benefiting its affiliate ‘Celltrion Healthcare’ by waiving inventory storage fees and providing free use of trademark rights, reports Yonhap news agency. .
The FTC concluded that such tactics undermined fair competition and resulted in Celltrion Healthcare’s unfair financial gain, estimated at 1.2 billion won.
However, the FTC decided not to refer Celltrion Chairman Seo Jung-jin to prosecutors for further investigation.
Kim Dong-myung, an FTC official, said, “The total benefit provided was less than 5 billion won, and it is not clear whether the chairman gave the order directly or was involved in the action.”
Earlier, the FTC announced that among 88 large business groups, including 10 chaebol or family-run groups, that are subject to annual inspections, Celltrion recorded the maximum proportion of inter-affiliate transactions at 65 percent in 2023.
Meanwhile, the South Korean drugmaker’s third-quarter net income declined 62 percent from a year earlier, despite quarterly sales hitting an all-time low. This was mainly due to the long-term effects of its 2023 merger with its sales and marketing partner Yonhap.
Net profit for the July-September period was 84.1 billion won ($60.6 million), compared with 221.2 billion won a year earlier, the company said in a regulatory filing.
Its operating income declined 22.4 percent year-on-year to 207.7 billion won, while sales rose 31.2 percent to a record high 881.9 billion won.
The report said that in the first nine months of the year, Celltrion’s cumulative revenue was 2.49 trillion won, which has already surpassed the full-year figure for 2023.
–IANS
SCH/AS
