The Competition Appeal Tribunal has confirmed that GSK and four other generic drug suppliers broke competition law by entering into a “pay for delay” deal for the antidepressant drug paroxetine. However, it slashed by £27 million the original fines imposed by the Competition and Markets Authority (CMA).
According to the CMA, GlaxoSmithKline had agreed to make payments totalling £50 million to other generic suppliers of paroxetine, including Generics UK and Alpharma, to unlawfully “delay the potential entry of these competitors supplying generic medicines into the UK market.”
The CMA imposed fines totalling £44.99 million on the companies directly involved in the infringements. In March 2018, the Tribunal dismissed a number of the companies’ grounds of appeal against the CMA’s decision.
It referred the remaining grounds to the Court of Justice of the European Union (CJEU) for a preliminary ruling on various questions of EU law, which confirmed in January 2020 that this type of “pay for delay” agreement had the object of restricting competition.
The judgment on May 11, 2021 from the Tribunal unanimously dismissed all of the pharmaceutical companies’ remaining grounds of appeal in respect of the infringements but lowered the CMA’s original fines imposed on the companies.
Michael Grenfell, the CMA’s executive director of enforcement, said: “We welcome the
Tribunal’s findings that GSK and a number of generic suppliers broke competition law. These agreements can cost the NHS and taxpayers millions of pounds.”
He added that the CMA was “disappointed” that the Tribunal reduced the fines imposed by the CMA “for these serious breaches of competition law.”
The CMA’s decision imposed the following fines:
a) GSK’s total fine was £37,606,275;
b) In respect of GUK’s infringement, total fines of £5,841,286 were imposed on Merck KGaA (Generics UK’s former parent) and Generics UK;
c) In respect of Alpharma’s infringement, total fines of £1,542,860 were imposed on Actavis, Xellia and Alpharma LLC.
The revised fines imposed by the CAT are:
a) GSK total fine is £22,200,602;
b) In respect of Generics UK’s infringement, total fines of £3,894,191 have been imposed on Merck KGaA and Generics UK;
c) In respect of Alpharma’s infringement, total fines of £1,028,574 have been imposed on Actavis UK Limited, Xelia Pharamceuticals ApS and Alpharma LLC.
