UK competition authorities fine GSK 376m

THE UK Competition and Markets Authority (CMA) has fined GSK £37.6m (US$54.5m) for stalling a generic version of its branded anti-depressant Seroxat from reaching the market.

The fine relates to GSK’s conduct between 2001 and 2004 when payments of over £50m were made to Generics UK (GUK) and Alpharma – makers of the generic anti-depressant paroxetine – to delay the drug’s release.

GSK held certain patents relating to paroxetine at the time, and claimed the GUK and Alpharma products infringed upon the patents. After threatening litigation, both companies entered into an agreement with GSK prohibiting their products’ entry into the UK market.

The CMA has deemed GSK’s “pay-for-delay” approach as illegal as it potentially deprived the UK’s National Health Service (NHS) of price falls of up to 70% by 2003 from generic competition. It said this practice “infringed the competition law prohibition on anti-competitive agreements.”

The CMA has issued fines totalling £44.9m in this case, including GSK’s fine, and a £5.8m and a £1.5m fine for GUK and Alpharma respectively for accepting payments to delay their products.

Michael Grenfell, executive director for enforcement at the CMA, said, “Today’s decision sends out a strong message that we will tackle illegal behaviour that is designed to stifle competition at the expense of customers – in this case, the NHS and [the] taxpayers.”

This has been the largest fine the CMA has given since its inception in 2014.

GSK said in a statement that it disagrees with the ruling and is “considering its grounds for appeal,” claiming the agreements were made in order to “settle costly, complex and uncertain patent disputes.”

It added that “the agreements allowed the generics companies to enter the market early with a paroxetine product and ultimately enabled a saving of over £15m to the NHS.”