ECJ advocate general finds GlaxoSmithKline violated antirust laws

[JURIST] European Union Advocate General Damaso Ruiz-Jarabo on Monday advised [opinion, in French] the European Court of Justice (ECJ) [official website] that pharmaceutical giant GlaxoSmithKline (GSK) [corporate website] has engaged in abusive practices that contravene EU antitrust laws in connection with a lawsuit filed by Greek drug wholesalers against GSK. The lawsuit stems from a three-month period in 2000 when GSK refused to provide the entire orders of Greek drug wholesalers for three patented products. In an apparent attempt to prevent the wholesalers from exporting the drugs and selling them at a lower price to European countries where the products command a higher price, GSK sold directly to hospitals and pharmacies in Greece and filled wholesalers' orders to the extent only that the Greek market required. In his opinion [press release, PDF], Ruiz-Jarabo found that any loss of income GSK has suffered due to the parallel importation of its products has not caused a reduction in the amount of capital available for research and development. He also asserted that GSK has failed to demonstrate that its policy of partially filling orders has positively affected the market or increased economic efficiency in any way. Ruiz-Jarabo, however, also opined that GSK could justify its dominant position by proving that its practices are necessary to protect its legitimate business interests.

This parallel importation from countries with lower drug prices to countries with higher drug prices has found support with the European Commission because it may decrease drug prices in general, but has predictably frustrated drug manufacturers, which have sought ways to prevent the practice. The opinions of advocates general are not binding, but ECJ decisions align with them about 80 percent of the time. The Wall Street Journal has more.



 

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