Imposes penalty on eight other pharma firms for delaying market entry of cheaper generic drug

The European Commission, on Wednesday, imposed a fine of 146 million euro on nine pharma companies, including Ranbaxy Laboratories, for delaying market entry of cheaper generic versions of Danish company Lundbeck’s branded citalopram, a blockbuster anti-depressant.

According to information available on the European Commission (EC) website, Ranbaxy Laboratories has been fined euro 10.32 million (over Rs.80 crore).

“The European Commission has imposed a fine of euro 93.8 million on Danish pharmaceutical company Lundbeck and fines totalling euro 52.2 million on several producers of generic medicines,” the EC said.

In 2002, Lundbeck agreed with each of these companies to delay the market entry of cheaper generic versions of Lundbeck’s branded citalopram, a blockbuster anti-depressant, it added.

“These agreements violated the EU antitrust rules that prohibit anticompetitive agreements (Article 101 of the Treaty on the Functioning of the European Union — TFEU),” the EC said.

Generic companies

The generic companies which have been fined are: Alpharma (now part of Zoetis), Merck KGaA/Generics UK (Generics UK is now part of Mylan), Arrow (now part of Actavis), and Ranbaxy.

The fine on Ranbaxy Laboratories and Ranbaxy (UK) Limited, is euro 1.03 million.

Commenting on the development, European Commission Vice-President JoaquAlmunia (in charge of competition policy), said: “It is unacceptable that a company pays off its competitors to stay out of its market and delay the entry of cheaper medicines.

Patient harm

“Agreements of this type directly harm patients and national health systems, which are already under tight budgetary constraints. The Commission will not tolerate such anticompetitive practices“.

Reacting to the fine, Ranbaxy Laboratories said: “Ranbaxy is disappointed with the decision by the European Commission to rule its patent settlement agreement with Lundbeck, covering the molecule Citalopram, anti-competitive, and intends to appeal the decision to the General Court of the European Union.”

These events took place over ten years ago, and the company considers that the Commission has misunderstood the facts and misapplied the law, it said, adding it believed it has strong grounds of appeal. Citalopram is a blockbuster anti-depressant medicine and was Lundbeck’s best—selling product at the time.

Related patents

The EC said after Lundbeck’s basic patent for the citalopram molecule had expired, it only held a number of related process patents which provided a more limited protection. Producers of cheaper, generic versions of citalopram therefore had the possibility to enter the market.

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