Antitrust: Commission sends Statement of Objections to Lundbeck and others for preventing market entry of generic antidepressant medicine
The European Commission has informed the Danish pharmaceutical company Lundbeck of its objections regarding agreements concluded with four generic competitors concerning citalopram, a blockbuster antidepressant. The Commission is of the preliminary view that the agreements aimed at preventing the market entry of cheaper generic medicines, in violation of EU antitrust rules. The Statement of Objections is also addressed to Merck KGaA, Generics UK, Arrow, Resolution Chemicals, Xellia Pharmaceuticals, Alpharma, A.L. Industrier and Ranbaxy, which belonged to the generic groups that concluded the agreements. The sending of a Statement of Objections does not prejudge the final outcome of the investigation.
In its Statement of Objections, the Commission takes the preliminary view that Lundbeck concluded agreements with generic companies to prevent the market entry of competing generic versions of its best-selling medicine citalopram. Generic entry became in principle possible when certain of Lundbeck's citalopram patents had expired. But the companies entered into agreements that foresaw substantial value transfers from Lundbeck to its four generic competitors, who subsequently abstained from entering the market with generic citalopram. The value transfers included direct payments from Lundbeck to the generic competitors and also occurred in other forms, such as the purchase of generic citalopram stock for destruction or guaranteed profits in a distribution agreement.
This behaviour, if established, would infringe Article 101 of the Treaty on the Functioning of the European Union (TFEU) that prohibits restrictive business practices. At this point, the Commission considers that the practices may have caused substantial consumer harm. This is because they may have delayed the entry of generic medicine for up to two years and the prices for citalopram remained high as a result.
Together with the Servier investigation (see MEMO/09/322), this is the first case dealing with so called "pay for delay" agreements.
Read the entire press release (in English) here.