A Dose of Competition: EU Antitrust Law in the Pharmaceuticals Sector

27 Pages Posted: 4 Sep 2015 Last revised: 11 Oct 2015

See all articles by Leigh Hancher

Leigh Hancher

Tilburg Law School; Tilburg Law and Economics Center (TILEC)

Wolf Sauter

Tilburg Law and Economics Center (TILEC); Dutch Healthcare Authority; Tilburg Law School; Netherlands Authority for Consumers and Markets (ACM)

Date Written: September 1, 2015

Abstract

In the pharmaceuticals sector there is an inherent tension between intellectual property rights and antitrust. This paper examines this tension over the past 10 years since modernisation of EU competition law. It looks at three types of problems: (i) restrictions on parallel imports; (ii) abuse of administrative procedure; and (iii) pay for delay cases. This overview shows that the European Commission is now especially active in areas (ii) and (iii) and generally relies on a more formalistic approach of finding restrictions by object instead of using economic arguments to demonstrate restrictions by effect. The by object approach is supported by the EU Courts. Also, the molecule (active ingredient) is often regarded as the relevant product market, facilitating a finding of dominance. Some national competition authorities have followed in the footsteps of the Commission but on the whole they are less active, for instance on pay for delay. This may be because the EU Courts have yet to rule on this type of case. For pharmaceutical companies the net result is that they cannot assume their intellectual property rights will stand in the way of a finding of antitrust infringement and their behaviour will be scrutinised closely.

Keywords: EU, competition law, antitrust, pharmaceuticals, dominance, parallel imports, judicial review, modernisation

JEL Classification: K21, L12, L13, L41, L65

Suggested Citation

Hancher, Leigh and Sauter, Wolf, A Dose of Competition: EU Antitrust Law in the Pharmaceuticals Sector (September 1, 2015). TILEC Discussion Paper No. 2015-017. Available at SSRN: https://ssrn.com/abstract=2655691 or http://dx.doi.org/10.2139/ssrn.2655691

Leigh Hancher (Contact Author)

Tilburg Law School

Tilburg, 5000 LE
Netherlands

Tilburg Law and Economics Center (TILEC) ( email )

Warandelaan 2
Tilburg, 5000 LE
Netherlands

Wolf Sauter

Tilburg Law and Economics Center (TILEC) ( email )

Warandelaan 2
Tilburg, 5000 LE
Netherlands

Dutch Healthcare Authority ( email )

Postbus 3017
Utrecht, 3502 GA
Netherlands

Tilburg Law School

Tilburg, 5000 LE
Netherlands

Netherlands Authority for Consumers and Markets (ACM) ( email )

PO Box 16326
2500 BH The Hague
Netherlands

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