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GSK and others’ paroxetine deal broke competition law, tribunal says

The companies had originally been fined almost £45 million by the CMA

GSK and other generic suppliers of paroxetine broke competition law with a “pay for delay” deal on antidepressant paroxetine, the Competition Appeal Tribunal (CAT) has concluded.

The pharmaceutical companies had appealed the Competition and Markets Authority’s (CMA) 2016 findings that they had broken competition law, but the CAT dismissed any outstanding grounds of appeal in a judgment published yesterday (May 10).

This means the “Department of Health and Social Care will now be able to seek follow-on damages in the courts”, the CMA said in a statement.

The five companies involved in the case were GlaxoSmithKline (GSK), Generics UK Limited (GUK), Xellia Pharmaceuticals APS Alpharma LLC, Actavis UK Limited, and Merck KGaA.

Colluded to delay entry of generic versions of paroxetine

In 2016, the CMA found that some manufacturers of paroxetine – a medicine used to relieve symptoms of depression – had colluded to delay the entry of generic versions of the medicine to the market.

In response to this anti-competitive behaviour, the CMA fined the companies directly involved with the infringement – and, where relevant, their parent companies or successors to these companies – a total of £44.99 million.

The five companies involved in the case decided to appeal to the CMA’s findings.

In March 2018, the CAT “dismissed a number of the companies’ grounds of appeal against the CMA’s decision”. Yesterday, it dismissed “the outstanding grounds in each of the appeals against liability”, it said in the judgment.

Fines lowered

Despite upholding the CMA’s decision, the CAT imposed reduced fines on the five pharmaceutical companies, totalling £27.1m.

The companies have been asked to pay:

  • GSK: a total fine of £22,200,602
  • Merck KGaA (which is GUK's former parent) and GUK: total fines of £3,894,191
  • Actavis UK Limited, Xellia Pharmaceuticals ApS and Alpharma LLC: total fines of £1,028,574

The CMA executive director of enforcement Michael Grenfell welcomed the decision.

“These agreements can cost the NHS and taxpayers millions of pounds. [Yesterday’s] judgment sends out a strong message that agreements between pharmaceutical companies aimed at delaying generic entry are unlawful and won’t be tolerated,” he said.

The CMA is “disappointed” that the fines to the companies have been reduced, Mr Grenfell added.

“We will now take stock of [the] judgment and carefully consider next steps,” he said.

GSK "disappointed" in judgment

In response to the ruling, a GSK spokesperson told C+D: "We are disappointed in the UK CAT's judgment on liability. 

"This case relates to patent litigation settlement agreements from 20 years ago in a different regulatory and judicial landscape, as acknowledged in the reduction in the fine. It does not reflect the commercial agreements we have in place today."

C+D has contacted GUK, Xellia Pharmaceuticals APS Alpharma LLC, Actavis UK Limited, and Merck KGaA for comment.

What do you make of this announcement?

M. Rx(n), Student

The patient lost out. Although I don't think it was quite intended that way to be fair. Everyone one loves the occasional work-around.

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