Bloomberg News

AstraZeneca Antitrust Fine Should Stand, EU Court Aide Says

May 15, 2012

AstraZeneca Plc (AZN), the U.K.’s second-biggest drugmaker, shouldn’t get a further reduction in an antitrust fine of 52.5 million euros ($67.5 million), an adviser to the European Union’s highest court said.

Jan Mazak, the advocate general to the EU’s Court of Justice, said the tribunal shouldn’t re-examine a reduction of the penalty, according at a non-binding opinion today.

A 2010 lower court ruling cut AstraZeneca’s fine from the 60 million euros initially levied by EU regulators. The company misled patent officials and flouted antitrust rules to block a generic version of its Prilosec heartburn medicine, according to the 2005 antitrust decision. Prilosec was the world’s best-selling drug in the late 1990s.

“The General Court correctly examined all the elements relevant to the calculation of the fine,” Mazak said in the opinion. The higher court shouldn’t “substitute, on grounds of fairness, its own assessment” to replace the legal reasoning underpinning the previous ruling. Mazak also advised the court to reject challenges from regulators, AstraZeneca and the European Federation of Pharmaceutical Industries and Associations, or EFPIA, an industry group.

The European Commission, the region’s antitrust regulator, has said AstraZeneca blocked cheaper versions from 1993 to 2000 to keep prices high. AstraZeneca provided the patent offices in Belgium, Denmark, Germany, the Netherlands, Norway and the U.K. with incorrect data to extend patent protection on Prilosec, according to the EU.

‘Fundamental Commitment’

AstraZeneca is “disappointed” with the legal adviser’s opinion that its appeal should be dismissed, said Sarah Lindgreen, a spokeswoman for the company. AstraZeneca takes “compliance with all laws seriously” and has “a fundamental commitment to doing business in an ethical and proper manner,” she said in an e-mail.

Richard Bergstroem, the director general of EFPIA, said the association challenged the 2010 ruling because it backed regulators’ “overly narrow market definition” to find that AstraZeneca had abused a monopoly position.

“This approach could have a chilling effect on pro-competitive commercial conduct and ultimately on innovation in Europe,” Bergstroem said in an e-mail. “It risks that virtually any innovative product” including those where substitutes can be prescribed to treat the same condition “may be regarded as constituting its own relevant market in which case the innovator will be assumed to be dominant.”

Generic Competitors

The European Commission declined to comment on the advocate general’s opinion pending a final ruling from the court.

EU antitrust officials are reviewing pharmaceutical companies’ agreements with generic competitors to check whether the deals break antitrust rules by delaying the market entry of generic versions of branded medicines.

The EU in March dropped a probe into AstraZeneca and Nycomed A/S, now part of Takeda Pharmaceutical Co., after it found no evidence that they had colluded to keep cheaper copies of medicines off the market. The EU’s antitrust agency raided AstraZeneca and Nycomed in November 2010. AstraZeneca, second to GlaxoSmithKline Plc in the U.K., said at the time that the inspections at its premises concerned the ulcer drug Nexium.

While the court aide’s opinion isn’t binding, it is followed by the court in the majority of cases.

The case is C-457/10 P AstraZeneca v Commission.

To contact the reporter on this story: Aoife White in Brussels at awhite62@bloomberg.net

To contact the editor responsible for this story: Anthony Aarons at aaarons@bloomberg.net


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