Collusion Suspected in Clinical Testing Bids at Public Hospitals for 12 Years... Sanctions Begin for 7 Agencies Including GC Lab Foundation

Suspected Systematic Collusion in 706 Bids Over 12 Years
Prosecution Referrals and Administrative Fine Recommendations... Plenary Session Scheduled

Major clinical testing agencies suspected of colluding in bids for outsourced analysis of blood, tissue, and other specimens from national and public hospitals over the past 12 years have entered the sanction process of the Korea Fair Trade Commission (KFTC). The scale of the projects involved in this case is estimated to reach nearly 300 billion won.

On August 11, the KFTC Secretariat announced that it has sent an Examination Report—equivalent to an indictment in a criminal case—outlining the violations and recommended sanctions against seven agencies that led collusion in the bidding process for clinical specimen testing contracts from national and public hospitals. The commission has now started the full deliberation process.

The entities subject to possible sanctions are seven major domestic clinical testing institutions: GC Lab Foundation, GC Cell Co., Ltd., Samkwang Medical Laboratories, Samkwang Labtree Co., Ltd., Seoul Clinical Laboratories, Seegene Medical Foundation, and EONE Laboratories.

According to the KFTC examiner's investigation, these entities are believed to have engaged in bid-rigging and volume collusion in a total of 706 contract bids for clinical specimen testing services ordered by national and public hospitals from January 2012 to October 2024, for approximately 12 years and 10 months. The total contract amount subject to collusion reaches roughly 294 billion won.

Clinical testing is a core medical service that involves detecting and analyzing blood, urine, tissue, and other samples to diagnose human diseases. National and public hospitals have outsourced tests they cannot perform in-house to external professional agencies through competitive bidding; however, dominant players in this market are suspected of orchestrating a long-running scheme to divide the market, resulting in wasteful spending of budgets.

The examiner determined that the conduct constitutes the most serious violation of the Monopoly Regulation and Fair Trade Act in terms of bid-rigging and quantity collusion. As a result, the commission is recommending corrective orders, imposing administrative fines, and filing criminal complaints with the prosecution against the corporations and implicated executives and staff members. The firms involved can submit opinions within eight weeks of receiving the Examination Report. The KFTC plans to finalize the level of sanctions in a plenary session once the defense rights procedures have been completed.

This content was produced with the assistance of AI translation services.