10.09.2016
Fines of almost €150 million have been imposed on several undertakings in the context of an infringement intended to delay the marketing of generic versions of the antidepressant citalopram. This decision has been confirmed by the European Court of Justice on 8th September 2016.
The Danish pharmaceutical company Lundbeck is specialized in researching and marketing of new medical products. In the late 1970s the company developed and patented an antidepressant, which has an active ingredient called “citalopram”.
After its basic patent for the citalopram molecule had expired, Lundbeck only held a number of patents, which provided more limited protection. In particular, Lundbeck had filed a patent relating to a process for the production of citalopram (the salt crystallisation patent). Producers of cheaper, generic versions of citalopram could therefore have the possibility of entering the market.
In 2002, Lundbeck concluded six agreements concerning citalopram with four other European companies specialized in the production or sale of generic medicinal products. In return for the companies’ commitment not to enter the citalopram market, Lundbeck paid them substantial amounts and provided other incentives. In particular, Lundbeck paid significant lump sums, purchased stocks of generic products for the sole purpose of destroying them, and offered guaranteed profits in a distribution agreement. Those agreements gave Lundbeck the certainty that the generic medication would stay out of the market for the duration of the agreements.
In October 2003, the Commission was informed of the existence of the agreements at issue by the Danish authority for competition and consumers. After an investigation, the Commission considered that Lundbeck and the generic undertakings were at least potential competitors and that the agreements at issue constituted restrictions of competition by object. The amounts paid by Lundbeck in order to prevent those producers from entering the citalopram market corresponded approximately to the profits that they could have made if they had successfully entered the market. The Commission therefore imposed a total fine of €93.7 million on Lundbeck and €52.2 million on the generic undertakings. Lundbeck and the generic undertakings brought actions before the General Court of the European Union seeking the annulment of the Commission’s decision and the fines imposed on them. In its judgments, the Court dismisses the actions brought by Lundbeck and the generic undertakings and confirms the fines imposed on them by the Commission.
The Court considers first of all, like the Commission, that Lundbeck and the generic undertakings concerned were indeed potential competitors at the time the agreements at issue were concluded. The Court also considers that the Commission was entitled to conclude that the agreements at issue constituted a restriction of competition by object. In that respect, the Court takes the view that Lundbeck did not demonstrate that the restrictions set out in the agreements at issue were objectively necessary in order to protect its intellectual property rights and, in particular, its crystallisation patent. Lundbeck could have protected those rights by bringing actions before the competent national courts in the event that its patents were infringed.
Source: The General Court of the European Union confirms the fines of almost €150 million imposed on several undertakings in the context of an infringement intended to delay the marketing of generic versions of the antidepressant citalopram
http://curia.europa.eu/jcms/upload/docs/application/pdf/2016-09/cp160090en.pdf
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