Venice Summer School 2010 – EU Integration and HealthSystems, 28 July 2010
Unit E.1, Antitrust – Pharma and Health Services
Martin Dorazil,European Commission, DG Competition
State aid / Public procurement and Health
Martin Dorazil,European Commission, DG Competition
• "Competition policy is basically about making sure
that companies compete with each other on an equal footing – on the basis of their products and prices –with no unfair advantages."
– Low prices for all– Better quality– More choice– Innovation– Better competitors in a global market
Martin Dorazil,European Commission, DG Competition
• Antitrust (Articles 101 & 102 of the TFEU)
Agreements or decisions of associations of undertakings or concerted
Adversely affecting trade between Member States
• Paragraph 3 - The Exception (“Rule of Reason”)
Martin Dorazil,European Commission, DG Competition
• Agreements/behaviour fulfilling the criteria for exemption are
• The Commission, each NCA and each Court may assess independently
whether an agreement is prohibited or not
• The Commission may grant exemptions to categories of agreements
(“block exemptions” e.g. for vertical agreements, motor vehicle distribution, R&D cooperation)
• Per se prohibition of certain hard core restrictions (e.g. fixing prices,
production or sales quotas, sharing markets …)
Martin Dorazil,European Commission, DG Competition
“Any abuse by one or more undertakings of a dominant position within the common market or in a substantial part of it shall be prohibited as incompatible with the common market insofar as it may affect trade between Member States.”
Dominance: the ability to behave independently from customers & competitors
– Imposing unfair purchase or selling prices or other unfair trading conditions
– Limiting production, markets or technical development
– Applying dissimilar conditions on equivalent transactions
– Certain forms of bundling & tying
Martin Dorazil,European Commission, DG Competition
• Art. 101 and 102 enforced in parallel by the European Commission,
National Competition Authorities (NCAs) and national courts
Decisions which are binding on the companies concerned
Judicial review by the General Court (formerly Court of First Instance) with a further appeal to the European Court of Justice
No criminal sanctions! (US: jail sentences for antitrust violations possible)
impose fines of up to 10% of overall turnover
impose structural remedies (only if proportionate and behavioral remedies would not work)
Martin Dorazil,European Commission, DG Competition
• Regulation 139/2004 (EC Merger Regulation)
• All mergers above certain turnover thresholds must be
notified to the Commission before they are implemented
• The Commission examines whether the proposed merger
”would significantly impede effective competition (…), in
particular as a result of the creation or strengthening of a
dominant position” (Article 2 ECMR)
Martin Dorazil,European Commission, DG Competition
• Legal basis:
• Promoting small and medium-sized enterprises
• Research and development (R & D),
• Training, employment and culture.
• Mergers – examples from Health sector
• State aid / Public procurement and Health
Martin Dorazil,European Commission, DG Competition
"Every entity engaged in economic activity, regardless of the legal status of the entity and the way in which it is financed" (C-41/90 Höfner)
– organisations charged with the management of compulsory social security
schemes, based on the principle of solidarity (C-159/91 and C-160/91, Poucetand Pistre)
– sickness funds when they determine fixed maximum amounts corresponding to
the upper limit of the price of medicinal products whose cost is borne by sickness funds (C-264/01 AOK Bundesverband)
– organisations managing national health service carrying out purchasing activities
when the purchased goods were used exclusivelz to provide services free ofcharge on the basis of universal coverage (C-205/53 FENIN)
– a non-profit making pension fund, optional affiliation, principle of capitalisation
(C-244/94 Fédération Française des sociétés d'assurance )
– pension funds operating in competition with insurance companies (C-67/96,
Albany, Case C-115/97, Brentjens and Case C-67/96 Drijvende Bokken)
Martin Dorazil,European Commission, DG Competition
• Area with probably most competition scrutiny over the past
• A specialised trader buys a medicine at a low price in one MS
and exports it to another MS where the product is sold at a higher price.
• GSK case (C-501/06 P, C-513/06 P, C-515/06 P and C-
– upper price limits for reimbursed medicines in Spain, but
no such upper limits for exported products
– Commission: refused to grant exemption under Art. 81(3)
– ECJ: the Commission had not sufficiently
investigated/rebutted the arguments put forward by GSK
Martin Dorazil,European Commission, DG Competition
• Limit the volumes for wholesalers and thus indirectly limit the volumes
• Art. 101 – Adalat case (C-2/01 P and C-3/01 P)
– Bayer ceased to fulfil orders if wholesalers believed to export– Commission: anticompetitive agreement existed between Bayer and the
wholesalers, as they had continued their commercial relations in spite of the supply restrictions
– ECJ: “no meeting of minds“ = no agreement
• Art. 102 – Lelos case (C-468/06 to 478/06)
– GSK interrupted and then limited supplies to Greek wholesalers to limit
– ECJ: limiting parallel trade is in principle anti-competitive under Art. 82 EC– But not an unlimited supply obligation on dominant pharmaceutical
companies => orders “out of the ordinary“
Martin Dorazil,European Commission, DG Competition
January 2008 – July 2009EU Pharmaceutical sector:
Total annual sales in 2007: € 214 billion2% GDP = Each patient spends 430 €/annum on prescriptionmedicines
Generic delayDecline in innovationImportance also of regulatory frameworkFinal Report underlines the need for effective patent system to maintain incentives for innovation
Martin Dorazil,European Commission, DG Competition
• Generic delay: more than 7 months on average
– Generic price is on average 25% lower than price of
originator product prior to loss of exclusivity.
Impact of generic entrySource: http://www.observatorysummerschool.org/materiale2010/148/B4_MDorazil.pdf
Ergebnisübersicht: Gechingen,PLS vom 19.-20.05.2012 19.05.2012 - 20.05.2012 1 Springprüfung Kl. M* mit Stechen Springprüfung Kl. M* mit StechenEhrenpreis gegeben von Fa. Böckmann1. Simon Metz (Ammerbuch/PSV Gäufelden e.V/GER) auf Levell *0.00 / 37.942. Melanie Deck (Ehningen/RFV Ehningen) auf Queeny 49 *0.00 / 42.283. Viktoria Gohl (Wildberg/RG Waldhof Wildberg/GER) auf Rotdorn 8 *
Verkorte productinformatie Inspra (opgesteld: september 2013). De volledige productinformatie (SPC) is op aanvraag verkrijgbaar. Samenstelling: Inspra 25 en 50 bevatten respectievelijk 25 mg en 50 mg eplerenone per filmomhulde tablet. Indicaties: Eplerenone is geïndiceerd als adjuvans aan de standaardtherapie, waaronder bètablokkers, voor reductie van het risico van cardiovasculaire m