UK Regulator Fines GSK Over Generic Drug Delay - Update
February 12 2016 - 3:42AM
Dow Jones News
By Ian Walker
LONDON--U.K. pharmaceutical company GlaxoSmithKline PLC has been
fined GBP37.6 million ($53.7 million) by the U.K.'s Competition and
Markets Authority for trying to delay the potential entry of
competitors into the U.K. generic-drugs market for antidepressant
drug paroxetine.
Between 2001 and 2004, GlaxoSmithKline agreed to make payments
and provide other benefits, together valued at more than GBP50
million, to suppliers of generic versions of paroxetine, the CMA
said in a news release.
"The CMA has found that these payments and other value transfers
were aimed at delaying the potential entry of generic competitors
into the U.K. market for paroxetine," the U.K. regulator said.
GlaxoSmithKline said it disagreed with the ruling and was
considering grounds for appeal.
In 2001, a number of pharmaceutical companies, including
Generics (U.K.) Ltd. and Alpharma Ltd., were trying to enter the
U.K. market for paroxetine with a generic version. Glaxo challenged
these pharmaceutical companies, alleging that their generic
products would infringe its patents, and started litigation
proceedings against them.
The CMA said that 4.2 million prescriptions were issued for
GSK's own branded version of paroxetine--Seroxat--in 2000 in the
U.K. and that Seroxat sales exceeded GBP90 million in 2001. At the
time, GSK held certain patents in relation to paroxetine.
Before that litigation went to trial, Generics and Alpharma
entered into agreements with Glaxo, which included terms
prohibiting their independent entry into the U.K. paroxetine
market, the CMA said.
Glaxo's agreements with Generics and Alpharma infringed the
competition law prohibition on anticompetitive agreements, the CMA
said, and "potentially deprived the National Health Service of the
significant price falls that generally result from generic
competition."
The CMA said that when generic paroxetine eventually entered the
market at the end of 2003, average prices for the drug dropped by
over 70% in 2 years.
Glaxo disputed the CMA's ruling.
"GSK and the generics companies entered into these agreements at
the time in order to settle costly, complex and uncertain patent
disputes. The agreements allowed the generics companies to enter
the market early with a paroxetine product and ultimately enabled a
saving of over GBP15 million to the NHS," a Glaxo spokesman said in
an emailed statement.
The CMA on Friday also imposed fines on Generics and Alpharma of
GBP5.84 million and GBP1.54 million, respectively.
Write to Ian Walker at ian.walker@wsj.com
(END) Dow Jones Newswires
February 12, 2016 04:27 ET (09:27 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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