Europe moving away from pay-for-delay?

Further to our post on Tuesday on the introduction of new legislation in the US prohibiting pay-for-delay agreements, on the other side of the Atlantic the trend could be shifting in the opposite direction.

The European Commission has closed its investigation into GlaxoSmithKline (GSK) after Synthon, a Netherlands-based pharmaceutical company, withdrew its allegations against GSK. The EC had been examining whether GSK was in violation of EU competition law by potentially abusing its dominant position or entering into anti-competitive agreements or practices to delay or exclude competition from generic brands.

This was the second generic drugs inquisition dropped in a week. The day before, the EC dropped a similar probe of AstraZeneca and Nycomed, finding no evidence suggesting the companies had delayed market entry of generic drugs.

These apparently divergent positions in the US and Europe reveal the underlying tensions in the debate around pay-for-delay settlements – between those who consider them to save the cost of challenging patent applications and consequently incentivises future medical innovation, and those who vehemently oppose the agreements because they increase the cost of drugs

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for the community. However, the EC’s approach is consistent with the findings on both sides of the ditch that the number of potentially anticompetitive agreements is falling.

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