In a free market you would be right, but we don’t have a free market so pretending we do is naive.
Let’s add the rest of the context to your simplistic example:
Company A pays FDA board members under the table to approve their poison, this is illegal, but who cares, because Company A also pays lawyers, judges and politicians to cover their crimes Company A also owns all corporate media thanks to its generous ad buys. Through their corrupt business model of intentionally poisoning people and selling the antidote (partial and continued), plus a broken healthcare model where the government subsidizes both research and payment for pharmaceuticals, plus a broken insurance system that is also corrupt and abstracts the real costs from the consumer, they make tons of cash to support all their previous corrupt schemes.
Company B believes in the free market and knows that Company A is intentionally killing people and that the model is corrupt. They decide to develop, patent and sell their own non-poison medicine. Here’s what happens:
FDA is owned by A; sorry, no approvals Media is owned by A; denounces Bs products as dangerous Politicians are owned by A; Make sure no grant money is given to B for development Insurance companies owned by A refuse to cover Bs drugs; the total cost borne directly by individual consumers; it increases the price and reduces the demand.
Company B then goes out of business, because they were stupid libertarians who would rather play make believe in fairy tale land than face the reality of today’s hopelessly corrupt system.
English 
Español de Venezuela