Friday, May 7, 2010
Posted by D. Daniel Sokol
Dominik Schnichels and Satish Sule (both DG Comp) explain The Pharmaceutical Sector Inquiry and its Impact on Competition Law Enforcement.
ABSTRACT: Legal Context: This article covers the application of competition law to the pharmaceutical sector in general as well as background, results and potential impact of the Pharmaceutical Sector Inquiry in particular, which was carried out by the Commission in 2008/2009 on the basis of Article 17 of Council Regulation (EC) No 1/2003 in order to investigate potential competition problems within the pharmaceutical sector. Competitive relationships between originator and generic companies as well as those between originator companies themselves were examined in this context as well as commentaries on the regulatory framework. Practices that were particularly examined concerned the use of patent rights (including patent strategies, disputes, litigation and settlements) as well as interventions before regulatory bodies and lifecycle strategies.
Key points: The report found on the one hand found potentially problematic practices of companies in this sector as well as shortcomings of its regulatory framework. Whereas in the first case patent settlements with reverse payments and defensive patenting strategies will be further examined in the future in the latter case the fragmented European patent system, as well as delays in marketing authorisation as well as pricing and reimbursement procedures have to be pointed out.
Practical Significance: Patent settlements and defensive patenting strategies have been highlighted by the report as objects of future competition scrutiny in this sector. Furthermore a number of recommendations have been made to improve the regulatory framework, namely by creating a common European patent system as well as a unified specialised patent judiciary.