Is Competition Fair? Examining Structural Challenges in Trinidad & Tobago’s Pharmaceutical Sector

 Is Competition Fair? Examining Structural Challenges in Trinidad & Tobago’s Pharmaceutical Sector

Recent parliamentary discussions have renewed national attention on how medicines move through Trinidad and Tobago’s healthcare system.The debate highlights several structural conditions that may influence pricing, availability, and competition across the sector. Understanding these conditions is essential to ensuring a fair and resilient pharmaceutical market.

The Seven Major Pharmaceutical Wholesalers in T&T

A small group of large distributors plays a significant role in importing and supplying medicines across the country. These entities form the backbone of the supply chain:

1. Aventa Trinidad & Tobago (Agostini’s Group) – Vertically integrated with the SuperPharm retail chain.

2. Massy Distribution (Trinidad) – Part of the Massy Group, with a substantial pharmaceutical distribution portfolio.

3. Bryden pi Limited – Distributor of prescription and consumer healthcare products.

4. Ultra-Pharm Marketing Limited – Distributor of pharmaceuticals and health supplements.

5. A.A. Laquis Ltd. – Distributor of medical equipment and operator of associated retail outlets.

6. Healthcare Services (Caribbean) Limited (HSCL) – Supplier to hospitals, institutions, and medical practitioners.

7. Pharmaco Industries Limited – Supplier to pharmacies, clinics, and the wider healthcare market.

CAIR emphasises that the concern is not about the  the overall market structure and how it affects competition and consumer choice.

Five Key Problems: Their Causes and Solutions

For clarity and public understanding, the following section distills the major market-structure concerns into a simplified analytical framework—Problem → Cause → Solution—to outline how these issues arise and how they may be addressed.

Problem 1: Risk of Vertical Squeeze (Margin Squeeze)

Cause:
Some conglomerates operate at both the wholesale and retail levels. In such structures, economic theory suggests that the internal price offered to an affiliated retail chain may be more favourable than the wholesale price available to independent pharmacies.

Solution:

• Enforce the Fair Trading Act to ensure non-discriminatory wholesale pricing.

• Encourage a TTFTC review (if warranted) to assess systemic risks of margin squeeze.

• Consider structural separation only in extreme cases where conflicts of interest cannot be mitigated.

Problem 2: Limited Competitive Space for Independent Pharmacies

Cause:
Market concentration reduces the bargaining power of independent pharmacies, especially when operating costs rise faster than their ability to negotiate competitive wholesale terms.

Solution:

• Promote purchasing co-operatives to increase buying power.

• Support bulk-buy agreements among small and medium-sized retailers.

• Provide government technical assistance for pharmacies forming co-ops.

Problem 3: CFDD Approval Delays for New Drugs

Cause:
The Chemistry, Food and Drug Division’s current review process may take up to six months, slowing the entry of new generics and affordable alternatives.

Solution:

• Implement fast-track approvals (30–90 days) for products recognised by FDA, EMA, and similar regulators with bio-equivalence of the drugs at the helm of the approval matrix.

• Publish generalised approval timelines to increase transparency and predictability.

Problem 4: Barriers to Entry for New Distributors

Cause:
Extended approval timelines, administrative requirements, and the dominance of established firms create a high threshold for new distributors seeking to enter the market.

Solution:

• Reduce administrative backlogs through digital submissions and streamlined workflows.

• Offer targeted support to new generic importers.

• Establish service-level standards for approval timelines.

Problem 5: Reduced Consumer Choice and Long-Term Price Risks

Cause:
When competitive pressure decreases, independent pharmacies may scale back operations or close, leading to fewer choices for consumers and increased vulnerability to long-term price increases.

Solution:

• Strengthen TTFTC monitoring of market concentration.

• Support community-based and cooperative pharmacy models.

• Encourage policies that protect ownership diversity within the retail pharmacy sector.

CAIR’s Three-Point Action Agenda: Building a Fairer System

CAIR advocates for a pharmaceutical system that is transparent, competitive, and consumer-focused. Our analysis shows that addressing the current structural challenges is not about assigning blame; it is about protecting the public interest.

We urge government and regulatory bodies to move swiftly on the most critical policy shifts:

1. Immediate Activation of the TTFTC: Initiate a formal market study into vertical integration and margin squeeze risks as empowered by the Fair Trading Act.

2. Streamline CFDD Approvals: Implement an accelerated, 30–90 day fast-track system for medicines already approved by reputable international bodies.

3. Support Pharmacy Co-operatives: Provide immediate technical and legal assistance to independent pharmacies seeking to form purchasing co-operatives to restore their buying power.

4. Support a Pharmacy Manufacturing Co-operatives and Consumer NGO's by removing red tape and making resources available to harness our already skilled pharma and biotech workforce for the greater good, especially in critical areas such as NCDs.

Submitted By C. Patrick

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