Healthy Skepticism Library item: 16266

Warning: This library includes all items relevant to health product marketing that we are aware of regardless of quality. Often we do not agree with all or part of the contents.

Publication type: Report

DG Competition Pharmaceutical Sector Inquiry- Final Report
HAI Europe 2009 Aug 10
http://www.haiweb.org/11082009/10 Aug 2009 Statement DG Comp Final Report on Pharma Competition.pdf

Full text:

The final report of DG Competition on the Pharmaceutical Sector Inquiry (8 July
2009) confirms the preliminary findings: not only is the patent system being structurally misused
to delay and deter generic competition, but it is also preventing innovation.
The final report has adjusted the harsh tone adopted in the preliminary report in response to the
concerns voiced by industry. The pharmaceutical sector has welcomed the new report, stating
that it now reflects a more ‘holistic’ and balanced approach. However, while the tone of the
report has been altered, the findings and substantial conclusions have not.
The report maintains the unforgiving conclusions, which are now substantiated with additional
supporting data. The report finds that innovator companies systematically use numerous
strategies to prolong their market monopoly and deter innovation from competitors, and that
such measures are detrimental to national health budgets and access to innovative, safe, and
affordable medicines for European consumers.
The report underlines the originator companies’ increasing dependence on the revenues from
best-selling products, which companies inevitably seek to maintain for as long as possible (p3).
To achieve this goal, a so-called ‘toolbox of strategies’ are used, often in combination, by the
industry to discourage, delay, and even prevent generic entry into the market. Strategies
include:
i) Strategic patenting
ii) Patent litigation
iii) Patent settlements / reverse settlement agreements
iv) Interventions by originator companies in decisions by national authorities on marketing
authorisation, pricing and reimbursement status
v) Life Cycle strategies for follow on products (secondary patenting and divisional patent
applications)
vi) Negative information campaigns intended to dissuade consumers from using generic
products.
With regard to originator to originator competition, strategies include:
i) Defensive patent strategies (that ‘‘mainly focus on excluding competitors without
pursuing innovative efforts’’)
ii) Patent litigation and settlement agreements.
The report finds that:
Generics are, on average, 40% cheaper than the originator price two years after entering
the market. If generics had entered the market immediately after the originator lost
exclusivity, savings in the period of 2000-2007 could have been 20% higher.
One of the main policy recommendations in the report is to create an obligation for pharmacists
to dispense the cheapest generic whenever possible, as this will contribute to earlier generic
entry and greater savings for national health budgets. The report also supports the rapid
establishment of a community patent and unified patent litigation system – a recommendation
that also enjoys a broad consensus among stakeholders.
HAI Europe supports the main conclusions and findings of DG Competition’s final report.
However, we hope that this inquiry and its findings will trigger substantive actions to prevent any
anti-competitive behaviour that weakens access to safe, affordable medicines for patients and
consumers in Europe.
Link to DG Competition Pharmaceutical Inquiry Index:
http://ec.europa.eu/competition/sectors/pharmaceuticals/inquiry/index.html
Sophie Bloemen, Projects Officer, HAI Europe
sophie@haiweb.org