The European Commission this week fined Johnson &
Johnson and Novartis a combined €16 million for delaying the market entry of a
generic painkiller often used by cancer patients.
U.S.-based Johnson & Johnson was fined €10,798,000, and
Swiss-based Novartis was fined €5,493,000 for an agreement their Dutch
subsidiaries made in 2005 regarding the pain-killer depot patch fentanyl. According to the commission, the subsidiaries
formed an agreement to delay the market entry of a less expensive, generic
version of the fentanyl patch in the Netherlands, and violated the EU's
antitrust laws.
“J&J paid Novartis to delay the entry of a generic pain
killer,” Joaquin Almunia, the commissioner responsible for competition policy
and vice president of the European Commission, said in a statement following
the decision. “The two companies shockingly deprived patients in the
Netherlands, including people suffering from cancer, from access to a cheaper
version of this medicine. Today's decision should make pharmaceutical companies
think twice before engaging into such anticompetitive practices, which harm
both patients and taxpayers.”
Johnson & Johnson first brought fentanyl to the market
in the 1960s, and makes different forms of the powerful painkiller. The
pharmaceutical company's patent protection for the fentanyl depot patch ran out
in 2005 in the Netherlands. In July 2005, Novartis subsidiary Sandoz was poised
to release a generic version of the drug, including having the product
packaging ready, but held off on the drug's release after signing a “co-promotion
agreement” with J&J's Dutch subsidiary Janssen-Cilag, the commission said.
The agreement between the competitors included monthly
payments from the J&J subsidiary to Sandoz, which exceeded the likely profits
the company would have received by releasing the generic to the market, the commission
said. Sandoz did little to no promotion activities in support of the agreement.
The agreement lapsed in December 2006, when another company was getting ready
to launch its own generic fentanyl patch.
The commission launched a formal investigation into the
matter in 2011. The commission said the result of the “co-promotion agreement”
was a 17-month delay in providing a cheaper generic version of the drug,
keeping prices artificially high in the Netherlands.
Sandoz released a statement that it had received the
commission's decision and “rejected” the allegations that the agreement was
intended to deprive patients of cheaper medicine in the Netherlands. The
company said it looks forward “to putting this historical matter behind us.”
“Both Novartis and Sandoz fully believe in competition and
are committed to producing high-quality, affordable medicines to help people
around the world secure access to healthcare,” the company's statement said.
The commission's antitrust arm has pledged to continue
investigating so-called “pay for delay” agreements like the one in the
J&J-Novartis case. Earlier this year, the commission fined Denmark's
Lundbeck and a group of generic producers for delaying the market entry of an
antidepressant called citalopram.
In other antitrust action, the commission revealed last week
that it had raided the offices of
several consumer electronics companies in different member states after
suspicions surfaced that the companies were violating antitrust regulations.
The Commission said the companies are suspected of
restricting online sales of consumer electronics and small appliances, which
could lead to higher prices or unavailability of the products through certain
online retailers. While the commission did not name the companies involved, Reuters reported last week that the
companies raided included Philips, Samsung Electronics, and Media-Saturn. Reuters
said the three companies acknowledged their offices were visited by EU
officials and said they are cooperating with the investigation.
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