E-DRUG: HAI Europe Statement: DG Competition Pharmaceutical Sector Inquiry - Final Report
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10 August 2009- The final report of DG Competition on the Pharmaceutical
Sector Inquiry (8 July 2009) confirms the preliminary findings: not only
is the patent system being structurally misused to delay and deter
generic competition, but it is also preventing innovation.
The final report has adjusted the harsh tone adopted in the preliminary
report in response to the concerns voiced by industry. The
pharmaceutical sector has welcomed the new report, stating that it now
reflects a more 'holistic' and balanced approach. However, while the
tone of the report has been altered, the findings and substantial
conclusions have not.
The report maintains the unforgiving conclusions, which are now
substantiated with additional supporting data. The report finds that
innovator companies systematically use numerous strategies to prolong
their market monopoly and deter innovation from competitors, and that
such measures are detrimental to national health budgets and access to
innovative, safe, and affordable medicines for European consumers.
The report underlines the originator companies' increasing dependence on
the revenues from best-selling products, which companies inevitably seek
to maintain for as long as possible (p3). To achieve this goal, a
so-called 'toolbox of strategies' are used, often in combination, by the
industry to discourage, delay, and even prevent generic entry into the
market. Strategies include:
i) Strategic patenting
ii) Patent litigation
iii) Patent settlements / reverse settlement agreements
iv) Interventions by originator companies in decisions by national
authorities on marketing authorisation, pricing and reimbursement status
v) Life Cycle strategies for follow on products (secondary patenting and
divisional patent applications)
vi) Negative information campaigns intended to dissuade consumers from
using generic products.
With regard to originator to originator competition, strategies include:
i) Defensive patent strategies (that 'mainly focus on excluding
competitors without pursuing innovative efforts')
ii) Patent litigation and settlement agreements.
The report finds that:
Generics are, on average, 40% cheaper than the originator price two
years after entering the market. If generics had entered the market
immediately after the originator lost exclusivity, savings in the period
of 2000-2007 could have been 20% higher.
One of the main policy recommendations in the report is to create an
obligation for pharmacists to dispense the cheapest generic whenever
possible, as this will contribute to earlier generic entry and greater
savings for national health budgets. The report also supports the rapid
establishment of a community patent and unified patent litigation system
- a recommendation that also enjoys a broad consensus among
stakeholders.
HAI Europe supports the main conclusions and findings of DG
Competition's final report. However, we hope that this inquiry and its
findings will trigger substantive actions to prevent any
anti-competitive behaviour that weakens access to safe, affordable
medicines for patients and consumers in Europe.
Link to DG Competition Pharmaceutical Inquiry Index:
http://ec.europa.eu/competition/sectors/pharmaceuticals/inquiry/index.ht
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Sophie Bloemen, Projects Officer, HAI Europe
sophie@haiweb.org
www.haiweb.org