UPDATED: Competition watchdog probes Pharmacy2U purchase of LloydsDirect
The competition authority is looking into the “assets merger” of Pharmacy2U and LloydsDirect, the UK’s two largest online pharmacies, it has revealed.
The Competition and Markets Authority (CMA) is investigating Pharmacy2U’s acquisition of LloydsDirect, it announced today (November 30).
According to the CMA, it served initial enforcement orders on Pharmacy2U, LloydsDirect, P2U Holdings Limited, G Square Capital II L.P. and G Square Healthcare Private Equity LLP earlier this week (November 28).
The enforcement order said that the CMA is considering…whether [the merger] has resulted or may be expected to result in a substantial lessening of competition in any market or markets in the United Kingdom”.
It said that the two companies must not “take any action” that might lead to the “integration” of the businesses, transfer ownership or control of either business, or make any changes to “key staff” unless they have the “prior written consent of the CMA”.
The businesses must be “carried on separately” with “separate sales or brand identity” and no “business secrets, know-how, commercially-sensitive information, intellectual property or any other information of a confidential or proprietary nature…shall pass directly or indirectly” between them “except where strictly necessary”, it added.
The CMA said that it has not yet “formally” begun its “phase 1 investigation” and that both the launch of its “assets merger inquiry” and the deadline for its “phase 1 decision” are yet to be confirmed.
It encouraged interested parties to submit “written representations” about issues related to competition or in the public interest to [email protected]
A Pharmacy2U spokesperson told C+D that both Pharmacy2U and LloydsDirect “will fully collaborate with the CMA throughout the process and are confident that the CMA will decide to approve this transaction”.
They added that the two brands will “run independently” until it “[receives] approval from the regulator”.
“We are committed to continuity and service excellence and our focus is on looking after our patients and our people,” they said.
C+D also approached LloydsDirect for comment.
C+D reported last month that Pharmacy2U had bought LloydsDirect for an undisclosed sum.
And the Company Chemists’ Association (CCA) announced days later that Pharmacy2U had joined its ranks.
According to NHS Business Services Authority (NHSBSA) data hosted on PharmData, Pharmacy2U and LloydsDirect were the top two pharmacies for items dispensed in August 2023, with Pharmacy2U dispensing 1.6 million items and LloydsDirect dispensing 1.1 million items.