EU fines 6 drug firms 428 mln euros for blocking cheaper drugs (updated)

Krka dd Novo Mesto

09/07/2014 14:27

* France's Servier, Israel's Teva among those fined 
    * Six companies get combined penalty of 428 million euros 
    * EU's Almunia - deals to buy out competition broke rules 
    * Servier to challenge EU ruling in court 
 
 (Adds Servier appeal, details) 
    By Foo Yun Chee 
    BRUSSELS, July 9 (Reuters) - European Union antitrust 
regulators fined French drugmaker Servier, Israel's Teva 
 TEVA.TA  and four others a total of 428 million euros ($583 
million) on Wednesday, as they crack down on deals which block 
cheaper generic medicine. 
    Regulators on both sides of the Atlantic have frowned on 
such agreements, saying they jack up the cost of drugs by as 
much as 20 percent for consumers. 
    The pharmaceutical industry says so-called pay-for-delay 
deals, where brand-name drugmakers pay cheaper non-brand 
generics firms to hold back from launching rival medicines, help 
to avert lengthy and costly litigation. 
    "Servier had a strategy to systematically buy out any 
competitive threats to make sure that they stayed out of the 
market. Such behaviour is clearly anti-competitive and abusive," 
European Competition Commissioner Joaquin Almunia said in a 
statement. 
    The European Commission said Servier's deals with the 
generics rivals between 2005 and 2007 were aimed at protecting 
its best-selling blood pressure medicine perindopril from 
competition in the 28-country bloc. 
    Servier, France's second-largest drugmaker, was hit with the 
biggest fine at 331 million euros, while world No. 1 generic 
drugmaker Teva's penalty came to 15.57 million euros. 
    Servier said it would challenge the EU ruling in court. 
    "Patients have not been deprived of perindopril at any time. 
Moreover, generic entry has not been delayed. Servier has acted 
in a transparent and legitimate way to defend its patents," said 
spokeswoman Lucy Vincent. 
    The other penalised companies were Unichem  UNLB.NS  and its 
subsidiary Niche, as well as Matrix, which is now known as Mylan 
Laboratories, Slovenian peer Krka  KRKG.LJ  and Lupin.  
    The sanctions are the third by the Commission against 
pay-for-delay deals following fines in the past year against 
Denmark's Lundbeck  LUN.CO , Merck KGaA  MRCG.DE , Indian No. 1 
drugmaker Ranbaxy  RANB.NS , Johnson & Johnson  JNJ.N  and 
Novartis  NOVN.VX . 
    It is examining a similar deal between Teva and U.S. peer 
Cephalon, which is now part of the Israeli company, related to a 
pill for sleeping disorder.  
 
 (Reporting by Foo Yun Chee; Editing by Mark Potter and Elaine 
Hardcastle) 
 ((foo.yunchee@thomsonreuters.com)(+32 2 287 6844)(Reuters 
Messaging: foo.yunchee.thomsonreuters.com@reuters.net)) 
 
Keywords: EU SERVIER/TEVA PHARM IND