Chinese vitamin producer to appeal US price-fixing fines

A major Chinese drug maker said on Thursday that it is preparing to appeal massive antitrust fines ordered by a US court.

The United States District Court for the Eastern District of New York ruled on Nov 26 that Hebei Welcome Pharmaceutical Co Ltd, subsidiary of the North China Pharmaceutical Group Corp (NCPC), must pay $153.3 million in fines after finding it colluded with three other Chinese companies to raise prices for Vitamin C exports to the US market.

The ruling marked the first time a Chinese pharmaceutical company has been fined in a US antitrust case.

The Hebei-based NCPC said it has been preparing materials for the appeal. The company, one of China's four largest vitamin and antibiotic suppliers, added that it will disclose information regarding the case's progress.

Another three Chinese vitamin C exporters named in the case settled the lawsuit out of court.

Zhang Tingde, head of the NCPC's legal affairs department, said Chinese vitamin manufacturers did not work together to manipulate the price.

"Competition between vitamin producers is becoming intense because of excess production capacity. It is impossible for them to form an alliance," said Zhang Baorui, head of Hebei Pharmaceutical Profession Association.

Wang Fei, researcher with Hebei Academy of Social Sciences, said the case may have an extensive impact on the country's pharmaceutical industry.

"It is also too early to say if the case will fuel chain reactions that will prevent enterprises from other industries from expanding their business in the US," said Wang.