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CMA welcomes EU court ruling in pay for delay drug case

Christian Fernsby ▼ | January 31, 2020
The CMA welcomes a ruling from the EU Court of Justice in relation to its case that drug companies supplying an antidepressant called paroxetine broke the law.
Business in Britain   GlaxoSmithKline
The ruling follows appeals from GlaxoSmithKline and other pharmaceutical companies against the Competition and Markets Authority’s (CMA) decision that they had broken competition law. The CMA imposed fines of £45 million on the companies involved.

Topics: CMA drug

This ruling has clarified a number of important questions and will help competition authorities, including the CMA, in their work to tackle this harmful behaviour by pharmaceutical companies.

In 2016 the CMA found that GlaxoSmithKline had agreed to make payments totalling over £50 million to other generic suppliers of paroxetine. These payments were aimed at delaying the potential entry of these competitors into the UK market.

The CMA found these ‘pay for delay’ agreements deferred the threat of increased competition, and potentially deprived the NHS of the significant price falls that generally result from generic competition. In this case, when independent generic entry eventually took place, average paroxetine prices dropped by over 70% in 2 years.

Following today’s ruling, the case will now go back to the Competition Appeal Tribunal for a final judgment on the appeals.