On 1 July 2010, the European Union ("EU") General Court published its decision on an appeal made by AstraZeneca against the European Commission's decision of 15 July 2005, by which AstraZeneca was fined €60 million for abuse of dominance. This decision, which is the first of its kind in the EU, raises several points of interest for the pharmaceutical industry.
The General Court upheld most of the Commission's decision finding that AstraZeneca had abused its dominant position by:
These infringements were committed with the intention of unfairly restricting competition from generics and parallel imports.1
The Court found that AstraZeneca's representations to patent attorneys and European patent offices were characterised by a "manifest lack of transparency", which would prompt those offices to draw incorrect conclusions as to the first date of marketing authorisation for omeprazole in the EU. AstraZeneca's conduct was deliberate and contrary to the special responsibility of a dominant company. Thus, it violated Article 102.
ii) Deregistration of marketing authorisation
While upholding the Commission's finding that AstraZeneca had abused its dominant position by selectively deregistering the Losec capsule marketing authorisation, the Court noted:
The fact that AstraZeneca was entitled to request deregistration of marketing authorisations, pursuant to legislation other than competition law, did not mean that the conduct could escape the Article 102 prohibition. The illegality of abusive conduct under Article 102 is unrelated to its compliance or non-compliance with other legal rules.
The General Court's judgment can be found here.
In its press release MEMO/10/294, the Commission welcomed the judgment, as this is the first decision on abuse of dominance in the pharmaceutical markets, and it confirms that Article 102 applies to the pharmaceutical sector. As the judgment highlights that misuse of regulatory procedures can constitute an abuse of dominance, the Commission stated that it considers it be significant to the follow up to Commission's final report on its competition enquiry into the pharmaceutical sector, published 8 July 2009.
For any questions concerning this alert, please contact Douglas Lahnborg.
1 The Court reduced the fine imposed on AstraZeneca to €52.5 million holding that the Commission failed to establish to the required legal standard that the deregistration of marketing authorisations for Losec in Denmark and Norway was capable of having an impact on parallel imports.