Nortriptyline investigation: director disqualification

The CMA has secured the disqualification of a director whose company admitted it breached competition law.

From:
Competition and Markets Authority
Published
4 March 2020
Last updated
11 January 2022 — See all updates
Case type:
Competition disqualification
Case state:
Open
Market sector:
Pharmaceuticals

Disqualification undertaking

11 January 2022: The Competition and Markets Authority (CMA) secured a legally binding disqualification undertaking from Mr Pritesh Sonpal, a former Director of Lexon (UK) Limited. Mr Sonpal has given a disqualification undertaking not to act as a director of any UK company for a period of 4 years commencing on 12 January 2022.

Under the Company Directors Disqualification Act, the CMA has the power to apply to the court to disqualify a director from holding company directorships or performing certain roles in relation to a company for a specified period, if a company which he or she is a director of has breached competition law. The Act also allows the CMA to accept a disqualification undertaking from a director instead of bringing proceedings, which has the same legal effect as a disqualification order.

Court proceedings seeking director disqualification

27 August 2020: The Competition and Markets Authority (CMA) issued proceedings in the High Court of Justice, Business and Property Courts seeking the disqualification of Mr Pritesh Sonpal, a director of Lexon (UK) Limited.

The proceedings arise from the CMA’s decision dated 4 March 2020 that between 2015 and 2017, Lexon, King Pharmaceuticals Limited and Alissa Healthcare Research Limited exchanged commercially sensitive information about prices for Nortriptyline Tablets, the volumes they were supplying and Alissa’s plans to enter the market.

The CMA found that Lexon participated in the infringing behaviour during the period from 27 July 2015 to 27 May 2016. Lexon have filed an appeal in the Competition Appeal Tribunal against CMA’s decision and the penalty imposed.

The CMA issued these proceedings under section 9A of the Company Directors Disqualification Act 1986 following an investigation into Mr Sonpal’s conduct in relation to the breach of competition law. It is now for the court to decide whether to make a disqualification order against Mr Sonpal.

Director disqualification undertakings

Robin Davies

Leave to act application

17 December 2020: Following the hearing of the application of Mr Robin Davies to the court for permission to act as director and take part in the management of certain companies on 10 November 2020, Mr Davies has been granted permission by the High Court to continue to act as director, subject to strict conditions, in the particular circumstances of this case.

The CMA appeared at the hearing in accordance with its statutory role, which requires the CMA to bring to the attention of the Court any matters it considers relevant to the application. Having considered a number of factors, including the essential nature of the Alissa’s business as a pharmaceutical supplier (particularly during a global pandemic), the fact that there is no one suitable to replace Mr Davies and that he is the sole executive director, and the fact that a well-qualified non-executive director has been appointed to oversee the compliance of Alissa with competition law, the CMA did not oppose Mr Davies’ application or raise any further concerns to the Court.

In issuing its judgment, the Court emphasised that the granting of ‘leave to act’ is not simply a rubber-stamping exercise by the Courts and that the protection of the public must be at the forefront of the Court’s mind when considering such applications. The Court also acknowledged the seriousness of competition law breaches and the role of disqualification in deterring directors from allowing their companies to breach competition law.

Although Mr Davies may now take part in the management of Alissa and its parent group during the term of his disqualification, he remains prohibited from taking on the directorship of any other UK company for the period of his disqualification. Mr Davies has also had to resign from other directorships he held, as a result of his disqualification.

Disqualification undertaking

21 August 2020: The Competition and Markets Authority (CMA) secured a legally binding disqualification undertaking from Mr Robin Davies, director of Alissa Healthcare Research Limited. Mr Davies has given a disqualification undertaking not to act as a director of any UK company for 2 years as of 24 November 2020.

Under the Company Directors Disqualification Act, the CMA has the power to apply to the court to disqualify a director from holding company directorships or performing certain roles in relation to a company for a specified period, if a company which he or she is a director of has breached competition law. The Act also allows the CMA to accept a disqualification undertaking from a director instead of bringing proceedings, which has the same legal effect as a disqualification order.

Amit Patel

1 June 2020: The Competition and Markets Authority (CMA) secured a legally binding disqualification undertaking from Mr Amit Patel, a former director of Auden Mckenzie (Pharma Division) Limited and Auden Mckenzie Holdings Limited (together “Auden Mckenzie”). Mr Patel has given a disqualification undertaking not to act as a director of any UK company for 5 years as of 13 July 2020.

Under the Company Directors Disqualification Act, the CMA has the power to apply to the court to disqualify a director from holding company directorships or performing certain roles in relation to a company for a specified period, if a company which he or she is a director of has breached competition law. The Act also allows the CMA to accept a disqualification undertaking from a director instead of bringing proceedings, which has the same legal effect as a disqualification order.

Phil Hallwood

20 December 2019: The Competition and Markets Authority (CMA) secured a legally binding disqualification undertaking from Dr Philip Hallwood, director of King Pharmaceuticals and Praze Consultants Limited. Dr Hallwood, director of King Pharmaceuticals and Praze Consultants Limited, has given a disqualification undertaking not to act as a director of any UK company for 7 years as of 19 March 2020.

Under the Company Directors Disqualification Act, the CMA has the power to apply to the court to disqualify a director from holding company directorships or performing certain roles in relation to a company for a specified period, if a company which he or she is a director of has breached competition law. The Act also allows the CMA to accept a disqualification undertaking from a director instead of bringing proceedings, which has the same legal effect as a disqualification order.

Further details about the CMA’s investigation can be found on the anti-competitive agreements and conduct in the pharmaceutical sector case page.

Contacts

Updates to this page

Published 4 March 2020
Last updated 11 January 2022 + show all updates

  1. Disqualification undertaking published.

  2. Leave to act application published.

  3. Court proceedings seeking director disqualification and director disqualification undertakings published.

  4. The CMA has secured a director disqualification undertaking.

  5. First published.

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