Sentiment towards Victrex (VCT) has been dealt another blow after it emerged that the maker of specialist polymer products agreed to settle allegations that its medical business insisted on long-term, exclusive contracts to prevent less powerful competitors from entering the market. Under the proposed consent order, the group's Invibio arm, which supplies a key polymer used in spinal and other medical implants, can no longer stop customers from using an alternative source of PEEK in new products.
Management replied in a statement that there were no penalties or fines attached, before adding that it hadn't violated any law and didn't expect the settlement to have a "material impact" on its business. But these reassurances weren't enough to arrest a 7 per cent fall in the share price to 1,400p.
Brokers were united in their belief that the market overreacted. That included Adam Collins at Liberum, who noted that the majority of Invibio's existing contracts are co-supplied and that competitors Solvay (BE:SOLB) and Evonik (DE:EVKX.N) specialise in different areas.
