wordpress blog stats
Connect with us

Hi, what are you looking for?

CCI approves MedLife-PharmEasy merger despite opposition from chemists’ body

Without disclosing any detail on the structure, the Competition Commission of India said it has approved the merger of MedLife with larger online pharmacy PharmEasy. The companies had filed for merger in August, and proposed a combination wherein API Holdings, the parent company of Pharmeasy will acquire a 100% stake in MedLife; in return, MedLife will acquire a 19.9% in the combined entity.

The merger has come through despite opposition from the Delhi-based South Chemists & Druggists Association, which argued that onlne pharmacies are not allowed under the law, and hence the CCI cannot permit “combination for an illegal purpose”.

In a representation to the CCI last week, the association had said that the proposed merger is essentially “that of two e-pharmacies as well as companies involved in the distribution chain”. It also said that the deep discounting by e-pharmacies can harm competition, given that these “are not based on any efficient business model but solely due to cash burn thanks to investment from foreign based entities”.

Thus, the resulting monopolistic market structure arising from the entry barriers created on account of network effects, coupled with the exit of efficient competitors from the market, cannot be easily self-corrected by market forces.

Since the e-pharmacies are any ways operating without any license, the combined entity would exploit the entire set up for its own benefit, at great cost of competition in the market. The combination would adversely distort the market, since the small retailers, offline chemists cannot integrate the distribution and retail sale under one umbrella due to license conditions, nor have the capacity to do so. SCDA

This merger in the online pharmacy space is the first since the entry of bigger players such as Reliance and Amazon into online medicine delivery space. Reliance Retail acquired a 60% stake in the Vitalic Health, parent company of Chennai-based NetMeds. The deal granted Reliance Retail 100% ownership of Vitalic’s subsidiaries NetMeds Marketplace, Tresara Health, and Dadha Pharma Distribution. Amazon also launched their online pharmacy in Bangalore, and began taking orders for prescription-based and over-the-counter medicines, “basic health devices”, and Ayurveda medication.

Advertisement. Scroll to continue reading.

Written By

I cover health, policy issues such as intermediary liability, data governance, internet shutdowns, and more. Hit me up for tips.

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.



Looking at the definition of health data, it is difficult to verify whether health IDs are covered by the Bill.


The accession to the Convention brings many advantages, but it could complicate the Brazilian stance at the BRICS and UN levels.


In light of the state's emerging digital healthcare apparatus, how does Clause 12 alter the consent and purpose limitation model?


The collective implication of leaving out ‘proportionality’ from Clause 12 is to provide very wide discretionary powers to the state.


The latest draft is also problematic for companies or service providers that have nothing to with children's data.

You May Also Like


Google has released a Google Travel Trends Report which states that branded budget hotel search queries grew 179% year over year (YOY) in India, in...


135 job openings in over 60 companies are listed at our free Digital and Mobile Job Board: If you’re looking for a job, or...


Rajesh Kumar* doesn’t have many enemies in life. But, Uber, for which he drives a cab everyday, is starting to look like one, he...


By Aroon Deep and Aditya Chunduru You’re reading it here first: Twitter has complied with government requests to censor 52 tweets that mostly criticised...

MediaNama is the premier source of information and analysis on Technology Policy in India. More about MediaNama, and contact information, here.

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ

Subscribe to our daily newsletter
Your email address:*
Please enter all required fields Click to hide
Correct invalid entries Click to hide

© 2008-2021 Mixed Bag Media Pvt. Ltd. Developed By PixelVJ