Lundbeck and 4 generics makers fined for pay-for-delay deals

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Lundbeck and 4 generics makers fined for pay-for-delay deals

Home/Policies & Legislation | Posted 28/06/2013 0 Post your comment

The European Commission (EC) announced on 19 June 2013 that it had fined Danish pharmaceutical company Lundbeck and four generics makers for pay-for-delay deals in Europe.

The fines have been imposed on the companies due to what the EC terms ‘anticompetitive agreements’ which the companies entered into and which the EC finds delayed the entry of generics on to the market.

The case goes back to 2002 when Lundbeck paid eight other pharmaceutical companies (AL Industrier, Alpharma, Arrow, Generics UK, Merck KGaA, Ranbaxy, Resolution Chemicals and Xellia Pharmaceuticals) to stop sale of generic versions of its blockbuster antidepressant Celexa (citalopram) [1].

The fines imposed by the EC total Euros 145 million, with Euros 93 million to be paid by Lundbeck and the rest to be paid by generics makers Alpharma, Arrow, Merck KGaA and Ranbaxy.

The EC states in its decision that these practices are ‘simply unacceptable’ and that such pay-for-delay deals ‘constitute severe infringements of EU competition law’. It adds that these deals ‘occurred at the expense of patients who were deprived of access to cheaper medicines’, giving as an example that in the UK once generic versions of citalopram did enter the market, prices dropped by an average of 90%.

Industry body – European Federation of Pharmaceutical Industries and Associations (EFPIA) – reacted with concern over EC’s decision, stating that this ‘weakens the protection afforded by patents and will undermine confidence in the patent system itself to the detriment of innovation and growth in Europe’. They add that the patent system in Europe is fragmented and inefficient and call for a full policy debate at the level of the College of Commissioners.

Lundbeck in a statement said that it ‘strongly disagrees with the Commission’s decision’ and ‘intends to appeal’. The company insists that ‘the agreements did not restrict competition in the market beyond the protection already offered by society via the patent rights’ and that ‘the generic[s] companies acknowledged that their products violated Lundbeck’s patents’.

Reference

1. GaBI Online - Generics and Biosimilars Initiative. EU to fine 9 drugmakers over pay-for-delay deals [www.gabionline.net]. Mol, Belgium: Pro Pharma Communications International; [cited 2013 Jun 28]. Available from: www.gabionline.net/Policies-Legislation/EU-to-fine-9-drugmakers-over-pay-for-delay-deals

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Source: EFPIA, Europa, Lundbeck