JSE-listed Clicks will sell its shareholding in Unicorn Pharmaceuticals, the group announced in a statement on Monday.
Unicorn Pharmaceuticals is the manufacturing arm of Clicks.
Clicks’s share price gained on the day, 2.3%, trading at R352.27 at around 11 am.
Clicks share price
The announcement that it would dispose of Unicorn came after a March 2023 Constitutional Court ruling that Clicks was not allowed to own pharmacies while manufacturing its own medicine.
The Department of Health subsequently told Clicks that no new pharmacy licence applications would be processed until Clicks complied with the Constitutional Court ruling.
The matter was referred to the Director-general of the Department of Health to determine which sanction should apply.
“As part of a constructive engagement process with the Director-General and the Department of Health, Clicks Group proposed to regularise its position by the group divesting of its total shareholding in the manufacturing pharmacy, Unicorn Pharmaceuticals (Pty) Ltd,” the group noted.
The Director-General accepted this proposal on Thursday, 27 June 2024.
Clicks also noted that it is confident that the sale of its Unicorn shareholding will be completed by the end of July.
Eight-year legal challenge
The Constitutional Court ruling against Clicks in March last year resulted from a legal challenge brought by the Independent Community Pharmacy Association (ICPA) against Clicks in 2016.
ICPA argued that Clicks’s ownership of retail outlets and a manufacturing arm gave it an unfair advantage. Clicks pharmacists would try to sell the group’s generic products produced by Unicorn at the expense of other medicines in the market.
Clicks Group CEO Bertina Engelbrecht welcomed the “protracted legal process” resolution.
“The completion of the Unicorn disposal will pave the way for the Department of Health to issue outstanding and new pharmacy licences,” Engelbrecht added.
This story first appeared on Moneyweb.
