[Ip-health] Glaxo Violated EU Antitrust Law In Greece

[Judit Rius Sanjuan]

[The case numbers are C-468/06, C-469/06, C-470/06, C-471/06,
C-472/06, C-473/06, C-474/06, C-475/06, C-476/06, C-477/06, C- 478/06]

Glaxo Violated EU Antitrust Law In Greece
April 1st, 2008 9:40 am By Ed Silverman
http://www.pharmalot.com/2008/04/glaxo-violated-eu-antitrust-law-in-greece

Glaxo violated European Union antitrust laws when it refused to fill
orders placed by Greek wholesalers for several meds, according to an
adviser to the EU=92s highest court. Greek drugmakers had sued Glaxo as
part of an eight-year long dispute over its refusal to supply them
with three drugs in Greece and limit the stock they could export to
higher-priced countries, Bloomberg News reports.

Drugmakers have been fighting parallel importation in which
wholesalers buy meds at state-regulated prices in countries such as
Greece then sell them in more expensive markets, such as the UK, and
pocket the difference. The case is expected to clarify the rights of
drugmakers, which claim the practice costs them more than $6 billion
in lost sales each year, to control supply to parallel traders,
according to Bloomberg.

=93A pharmaceutical company holding a dominant position which refuses to
meet the orders of wholesalers in order to limit parallel trade
engages in abusive practice,=94 Damaso Ruiz-Jarabo, an advocate general
at the European Court of Justice, said in a non-binding opinion. =93In
this case, there are no objective reasons relating to state
intervention in the market which would excuse such conduct.=94

In 2000, Glaxo cut off supplies of three drugs - Lamictal, Imigran and
Servent - to Greek wholesalers and, instead, sent the drugs directly
to Greek hospitals and pharmacies. The drugmaker later resumed sales
to wholesalers, but only partially filled their orders. As a result,
Glaxo was only shipping enough medication for the Greek market.

At a January hearing, Glaxo=92s lawyers told the court that the volume
of the wholesaler orders were =93preposterous=94 and =93exorbitant,=94 lawy=
ers
for Glaxo told the court at a hearing in January. This is the second
time the case reached the EU court, which in 2005 rejected it because
it had been referred by the Greek competition authority and not by a
court. In a non-binding opinion in 2004, one of the court=92s advocate
generals said Glaxo=92s practice doesn=92t abuse the drug-pricing system
in Europe under which the different nations set prices.

In addition to the dispute before the Greek competition authority, the
wholesalers sued Glaxo in Greek courts in 2001. They accused the
company of breaching EU antitrust rules. A Greek appeals court in 2006
referred the case back to the EU court for guidance on how much
companies can restrict parallel trade. The Greek antitrust authority
in 2006 decided that Glaxo should be allowed to restrict drug supply
to the wholesalers.

Judit Rius Sanjuan
Attorney at Knowledge Ecology International
www.keionline.org / www.cptech.org
Phone: +1.202.332.2670, x18
Email: judit.rius@keionline.org