When medicine retailers also make own brands

A giant drugstore chain also produces its own house label. Has the Philippine Competition Commission noticed?

Rights Report Philippines recently pointed up the anomaly. The biggest medicine retailer that controls 60 percent of pharmacies carries its own “branded generics.” Its 1,200-plus outlets push that brand of generics to customers.

The dominant retailer is both market gatekeeper and competitor. It’s unfair to consumers.

A retailer becomes a gatekeeper when it can control what customers see and buy: which brands are stocked, which ones are visible, which are promoted and which are recommended at the counter.

In a market where one chain has an outsized footprint, shelf access becomes market access. Its retail store network becomes the industry’s road. Whoever controls the road decides who gets through.

That road is major. Filipinos spent P615 billion out-of-pocket on health care in 2024, a 2025 House bill prefaced. More than P251 billion of that went directly to medicines bought at pharmacies. Yet, 99 percent of Filipinos said in a 2019 Pulse Asia survey that they don’t buy all their prescribed medicines because unaffordable.

Worse is when the gatekeeper becomes a competitor – through a private label or house brand. A pharmacy that sells its own generics line is no longer a neutral seller of competing products. It’s a rival to generic manufacturers and suppliers whose products it also carries.

That combination – gatekeeper plus competitor – sets a predictable incentive to self-prefer. And self-preference isn’t moral accusation. It’s economic reality.

The dominant retailer has every reason to give its house brand the best shelf placement and visibility; steer “cheaper alternative” conversations toward its own label; push its own marketing collaterals in prime spots and squeeze rivals through commercial terms, shelf fees or threats of delisting.

Even if competing products remain technically available, they may be practically disadvantaged – harder to find, less promoted or inconsistently stocked. Consumer “choice” becomes controlled choice.

Anyone who frequents pharmacies can see the preferential treatment enjoyed by a house brand of generics, upon entering the store to lining up to pay. House brand is visible on the shelves, reinforced by marketing collaterals in prime areas where customers’ eyes naturally go.

This preference could extend to the counter where pharmacists recommend the house brand. This distorts choice, disadvantages smaller market players and harms consumers.

Generated by Gemini

Competition commissioners must have experienced or overheard the uncompetitive exchange:

“Ay, wala na bang ibang mas mura?”

“Meron po, pero tatlong tableta na lang ang natitira; hindi namin alam kung kelan sila magde-deliver uli. Kung gusto mo po, itong generics namin, medyo mas mura at parating meron.”

Competition commissioners should also verify if multinational pharmaceutical firms actually supply the branded generics. The same generics medicines made by foreign firms are released to the market under the retailer’s packaging and label.

If a dominant pharmacy can source from the world’s main manufacturers then sell under its own label, it gains a powerful edge: trusted manufacturing + private-label branding + control of retail. Smaller suppliers will be crowded out. They can’t match the procurement scale, visibility or sales counter influence. Consumer understanding of “choice” is blurred.

This defeats the purpose of the Cheaper Medicines Act and the Generics Law. Philippine Competition Commission must step in.

Price regulation and generics policy are vital. But they can’t fully fix a market that is structurally uncompetitive. The Department of Health can set reference prices for public procurement. But it can’t discipline prices across private retail if a dominant retailer can shape market outcomes.

PCC exists for exactly this situation: when market structure and conduct combine to weaken competition and harm consumer welfare, especially in essential goods where demand is inelastic and consumers are vulnerable. Medicines are bought every day. The cost of delay is paid in missed doses, postponed refills and preventable suffering.

Filipinos deserve a medicine retail market where competition is real, not decorative. A contestable market produces lower prices, better service and broader choices. A captured market produces the opposite: self-preference, weaker rivals, sticky prices.

Rights Report Philippines recommended: “Apply competition law to pharmaceutical retail.

“PCC must investigate the documented market concentration in both distribution and retail. A single company controlling 60 percent of pharmacy retail is a textbook competition law problem. The Competition Act of 2015 was written for exactly this situation.”

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