Kingaroy company Alkaloids of Australia fined $1.8 million for global price fixing

For five years the South Burnett medicine company engaged in a global price fixing operation to control the sale of a key ingredient of common medicines derived from a plant native to Australia.

Alkaloids of Australia fine is one of the largest in Australia.

South Burnett exporter Alkaloids of Australia has been fined $1.8 million after the company and its former director pleaded guilty to engaging in criminal cartel conduct.

The company’s illicit activities came to light after an investigation by the Australian Competition and Consumer Commission.

Alkaloids of Australia produces scopolamine N-butylbromide (SNBB) is derived from duboisia plants native to the South Burnett region

It is the active pharmaceutical ingredient used in common antispasmodic medications and motion sickness medicine.

Alkaloids of Australia was fined $1.8 millions for criminal cartel activity.

Starting in July 2009 the company engaged in cartel activity for a five-year period which included price fixing that had a worldwide impact.

The company’s former export manager, Christopher Kenneth Joyce, was also convicted and sentenced to two years and eight months’ imprisonment to be served as an intensive corrections order, including 400 hours of community service.

Mr Joyce was disqualified from managing corporations for five years and fined $50,000.

The two parties pleaded guilty to three criminal charges, and admitted to a further seven offences, in respect of making, attempting to make, and giving effect to several cartel arrangements with overseas pharmaceutical ingredient suppliers that involved price fixing, bid rigging, output restriction and market allocation.

ACCC Commissioner Liza Carver welcomed the sentences.

“They serve as a strong reminder that criminal cartel conduct is a serious offence attracting serious consequences, including significant fines, banning orders, and imprisonment for individuals,” she said.

“The sentence imposed on Mr Joyce is the longest sentence of imprisonment imposed on an individual under the criminal cartel laws so far.”

The Federal Court handed down the company’s sentence on Thursday.

It heard Mr Joyce, on behalf of Alkaloids of Australia, regularly met at industry conventions and communicated via email and phone with competing manufacturers of SNBB around the world and agreed to fix the minimum price for SNBB, to allocate customers between each other and to arrange what price would be quoted to customers to ensure a particular manufacturer won the sale.

In addition, Mr Joyce, on behalf of Alkaloids of Australia, attempted to induce competing SNBB manufacturers to limit the production of SNBB and/or its precursor plant, duboisia, which is grown in Australia.