Unichem drops as EU decides to impose fine

Unichem Laboratories’ shares fell over 6% touching to Rs203.25, after the European Commission decided to impose a wholly fine on Niche/Unichem (jointly and severally).

Unichem Laboratories (Unichem) said that the European Commission (the EU’s top competition regulator) decided to impose a wholly unjustified fine on Niche/Unichem (jointly and severally) contending that it had acted in breach of EU Antitrust Rules. The European Commission reached this conclusion because its subsidiary, Niche Generics ( Niche), agreed to settle financially crippling patent litigation with Laboratories Servier (Servier) at the beginning of 2005, Unichem said in a statement.

Unichem said it vehemently denies any wrongdoing on the part of either itself or Niche. Moreover, Unichem was not involved in the agreement to settle the litigation with Servier back in 2005 as it only took full ownership of Niche late in 2006, the company said in a statement.

Unichem cannot in any way see how it can be held accountable for what was in any event a pro-competitive act on the part of its than only part-owned subsidiary Niche, Unichem said in a statement.

Unichem said it will vigorously appeal the European Commission decision to the EU courts and seek to attain the correct result in this matter a result which is the best interests of the consumer. While Unichem presses ahead with its intention to have the European Commission’s decision overturned it intends to carry on its business as usual, the company said in a statement.