Pfizer: Abuse of dominant position?

The Italian Antitrust Authority (Autoritá Garante della Concorrenza e del Mercato), has opened a preliminary investigation affecting Pfizer’s Italian subsidiary in order to verify if it has artificially extended the patent protection of the active principle latanoprost in Italy, in order to prevent new generic drugs entering the market.

As the IAA informs in the press release published on October 26:

.- The investigation started with the information provided by Ratiopharm.

.- Investigation is addressed to verify if Pfizer Italy took some actions in order to increase the costs of Generic Companies, taking advantage of Pfizer’s dominant position in the market. Main actions taken by Pfizer would be:

a) Filing a divisional application for a patent, followed by a request for a Complementary Protection Certificate (eventually rejected by the European Patent Office) in order to extend patent protection until 2011.

b) Taking legal actions against Generic Companies that were working to commercialise the drug after patent lapsing term in 2009.

.- The decision was notified to the company today in the course of inspections carried out by officers of the IAA assisted by the Financial Police (Guardia di Finanza).

.- The proceedings will last approximately a year.

Just a few days before the press release, chatting with Jeremy on “strange times”, I made reference to “the US report Protecting Consumer Access to Generic Drugs: the Benefits of a Legislative Solution to Anticompetitive Patent Settlements in the Pharmaceutical Industry and the Executive Summary of the Pharmaceutical Sector Inquiry Report by the EU Commission”.

The investigation now started in Italy follows the second report, where the EU Commission concluded that “national policy makers and public authorities may decide to take further action”.
We will see how this interesting investigation ends.

In the meanwhile, you may find interesting reading the English translation we have made of the press release published by IAA:

PRESS RELEASE

DRUGS: COMPETITION AND ANTITRUST MARKET GUARANTOR AUTHORITY OPENS PRELIMINARY INVESTIGATION REGRDING POSSIBLE ABUSE OF DOMINANT POSITION BY PFIZER

The proceeding shall verify if the company has tried to artificially extend patent protection of the active principle latanoprost (used to treat eye glaucoma) to prevent or delay generic drugs entering the market.

The Italian Competition and Antitrust Market Guarantor Authority, at its meeting held on the 13th of October 2010, decided to open a preliminary investigation regarding the company Pfizer to verify if, by its actions, the company has artificially extended the patent protection of the active principle latanoprost in Italy, in order to prevent new generic drugs from entering the market.

As a note of the Authority informs, the decision, notified to the company today in the course of inspections carried out by officers of the Guarantor Authority assisted by the Financial Police, was taken in the light of a comprehensive report of the company Ratiopharm. In the complaint was highlighted the behaviour of Pfizer Italy S.r.l. aimed at preventing or delaying entry in the Italian market of generics drugs of specialty Xalatan, drug produced and marketed by Pfizer for the treatment of eye glaucoma. According to the documentation, Pfizer would have fraudulently applied for and obtained an extension of patent coverage, through a divisional application to a patent, followed by a request for a Complementary Protection Certificate (hereinafter CPC) in order to extend patent protection until 2011. The divisional patent, in respect of which the CPC was granted, has also been recently declared invalid by the same European Patent Office of Monaco.

The investigation - which fits in the wake of the recent Pharmaceutical Sector Survey completed in 2009 by the European Commission - will have to check whether the conduct of Pfizer had the purpose of preventing a new generic drug from entering the market, abusing the dominant position held in the market with regard to products for treating the eye glaucoma. In fact, considering that the patent protection would have supposedly expired in September 2009, the generic drugs producers were legitimately relying upon putting on the market a new generic drug on that date: in this context they had faced a series of investments, afterwards made vain with the extension of the patent protection period.

With his behaviour, also in Court, Pfizer would have tried to create a state of legal uncertainty about the possibility to market the new generic drug, in order to make more expensive - for the generic drugs sellers - the actual cost of market entry of the generic drug, in terms of programming and implementation.

The end of the proceeding is scheduled for October 15th, 2011.