The European pharmaceutical industry has expressed satisfaction with the publication of a long-awaited investigation into alleged anti-competitive practices in the sector, saying the final report is softer than a preliminary version released in November 2008.
EFPIA, the trade group representing large pharmaceutical companies, highlighted a shift in tone in the EU executive’s final report on the sector and welcomed the “constructive policy recommendations”.
At a briefing yesterday (8 July), EU Competition Commissioner Neelie Kroes pressed for greater use of cheaper generic medicines in caring for an ageing population, and was critical of what she described as “rotten” agreements between some firms which hold up the release of new drugs.
However, the report puts considerable emphasis on the need for patent reforms and well-flagged plans for a single patent court system. This was welcomed by EFPIA, which said streamlining the European patent system would cut costs and reduce current legal uncertainties.
The pharma group also said the final report “failed to substantiate” earlier allegations that patenting strategies dampen innovation and illegitimately delay generic entry. It welcomed the acknowledgment in the report of the importance of Europe’s research-based pharmaceutical industry.
EFPIA board member Thomas Cueni said the EU has also accepted that not all “settlement agreements” between patent-holding pharma firms and generic manufacturers are necessarily improper.
The industry expressed concern that the push towards greater use of generics, coupled with the rising costs of conducting R&D in Europe, would damage the European pharmaceutical sector.
“The report demonstrates a welcome shift away from the emotive language of the interim report, with a better balanced, more holistic view of the issues facing the sector,” EFPIA said.
However, Commissioner Kroes did have some harsh words for the industry, saying the report confirms that company practices are a significant factor behind “competition problems” in the pharma sector.
New competition case
She also announced a fresh antitrust investigation against a French pharmaceutical firm for suspected breaches of rules on restrictive businesses practices and on abuse of a dominant market position.
The European Commission is to probe agreements between Les Laboratoires Servier and a number of generic companies over “possibly restrictive” practices which may have delayed the availability of a generic heart medication.
EU officials suggested further cases could follow, saying the new report would pave the way for increased regulatory scrutiny of settlement agreements in which brand-name companies pay generics manufacturers for not competing with them.
“It will look at this on a case-by-case basis to see if there is enough evidence that merits further scrutiny,” an official said.
The generic medicines industry also welcomed the publication of the report and called for the swift implementation of its findings.
However, consumer groups were less impressed. BEUC, the European consumers organisation, said questions remain over anti-competitive practices in the pharma sector and patients are getting a raw deal.
Key findings of the pharmaceutical sector inquiry:
- A Community patent and unified specialised patent litigation system in Europe would reduce administrative burdens and uncertainty for companies. A full 30% of patent court cases are conducted in parallel in several member states, and in 11% of cases national courts reach conflicting judgements.
- Recent initiatives of the European Patent Office (EPO) to ensure a high quality standard of patents granted and to accelerate procedures are welcome. This includes measures taken in March 2009 to limit the possibilities and time periods during which voluntary divisional patent applications can be filed (so-called “raising the bar exercise”).
The Commission is also urging member states to:
- Ensure that third party submissions do not occur and in any event do not lead to delays for generic approvals, and;
- Significantly accelerate approval procedures for generic medicines – for example, the Commission believes that generic products should automatically/immediately receive pricing and reimbursement status where the originator drug already benefits from such status, which would allow for a faster product launch in certain cases;
- Take action if misleading information campaigns questioning the quality of generic medicines are detected in their territory, and;
- Streamline trials that test the added value of novel medicines.