Alliance Medical Group Limited (Alliance) and IBA Molecular UK Limited (the IBA business) supply Fluorodeoxyglucose 18F (FDG-18), a radioactive tracer used in PET-CT scans which is purchased by hospitals and others who provide such scans. Due to its short radioactive half-life, an effective dose can only be given to a patient within a maximum of 8 hours following production, which limits the area which can be served by a particular production unit.
In its provisional findings report published today, a group of independent panel members at the Competition and Markets Authority (CMA) state that the IBA business has been loss-making for several years and suffers from a number of competitive weaknesses making it likely that, without this merger, its majority shareholder would not have found an alternative purchaser and would have closed the facility.
John Wotton, Chairman of the Alliance/IBA merger group and CMA Deputy Panel Chair, said:
It is likely that without the merger the IBA business would not have survived as an independent competitor to Alliance and we do not think it likely that anyone else would have purchased the business.
Customers, including those purchasing from the IBA business at the time of the merger, therefore have the same choice of supplier of FDG-18 as they would have had if Alliance had not bought the IBA business.
The Office of Fair Trading (OFT) referred the case to the Competition Commission (CC) in March 2014 following a phase 1 review, since which time the CMA has taken over the case (See notes for editors).
The CMA group is expected to publish its final report by 7 September 2014.
The group would like to hear from all interested parties on the provisional findings, in writing, by no later than 1 August 2014.
To submit evidence, please email Alliance.IBA@cma.gsi.gov.uk or write to:
Alliance/IBA merger inquiry
Competition and Markets Authority
Notes for editors
- The CMA is the UK’s primary competition and consumer authority. It is an independent non-ministerial government department with responsibility for carrying out investigations into mergers, markets and the regulated industries and enforcing competition and consumer law. From 1 April 2014 it took over the functions of the CC and the competition and certain consumer functions of the OFT, as amended by the Enterprise and Regulatory Reform Act 2013.
- The CMA therefore took over this case from the CC at the start of April.
- The members of the Alliance/IBA merger group are: John Wotton (Chairman and CMA Panel Deputy Chair), Sarah Chambers, John Krumins and Tim Tutton.
- All the CMA’s functions in phase 2 merger inquiries are performed by inquiry groups chosen from the CMA’s panel members. The appointed inquiry group are the decision makers on phase 2 inquiries.
- An inquiry group is appointed for each inquiry, supported by a case team of CMA staff. Under the Enterprise and Regulatory Reform Act 2013, the Chair of the CMA is responsible for identifying and appointing the inquiry group that will conduct a particular inquiry and for selecting one of them to act as chair of the inquiry group (the Inquiry Group Chair). In practice, the Chair of the CMA will delegate these responsibilities to the CMA Panel Chair.
- The CMA’s panel members come from a variety of backgrounds, including economics, law, accountancy and/or business; the membership of an inquiry group usually reflects a mix of expertise and experience (including industry experience).
- Enquiries should be directed to Rory Taylor or Siobhan Allen or by ringing 020 3738 6798 or 020 3738 6460.
- For CMA updates, follow us on Twitter @CMAgovuk, Flickr and LinkedIn.
Photo above by Thirteen Of Clubs on Flickr. Used under Creative Commons, photo resized and machine brand removed.