EU warns of antitrust probes into drug makers

2009-07-08 13:28:01 -

BRUSSELS (AP) - The European Union warned Wednesday of a wave of antitrust investigations into major drug makers, saying they were deliberately stalling cheaper generic versions of their own medicines once exclusive patents expire.
«Makers of original medicines are actively trying to delay the entry of generic medicines onto their markets,» EU Competition Commissioner

Neelie Kroes said.
The EU also started an investigation into France's Les Laboratoires Servier for hindering the launch of generic versions of its heart disease drug perindopril.
Regulators said they suspected that Servier did deals with generic rivals Krka, Lupin, Matrix, Niche Generics Ltd and Teva to hold back cheaper versions.
The European Commission said it would monitor deals between major pharmaceutical companies _ such as Pfizer Inc., GlaxoSmithKline and Sanofi-Aventis _ and generic drug makers because «every week and month of delay costs money to patients and taxpayers.
Kroes said regulators knew of at least 200 settlement agreements _ some including payments to delay drug launches _ between generic and major drug makers.
«A good number of them restrict entry onto the market of generics,» she told reporters. «These settlements cause prices for consumers and for taxpayers to remain substantially higher than if competition existed.
The EU says generic drugs are on average 40 percent cheaper than their branded rivals two years after they launch and play a key role in driving down health costs for Europe's aging and ailing population.
Regulators said they were aware that legal and patent problems also hold back generic drugs, calling for a new EU-wide patent and litigation system to replace separate national patents and legal actions for each of the EU's 27 countries.
«This is a waste of everyone's time and money,» Kroes said.
The EU also charged that drug makers try to discredit generic drugs with misleading campaigns and also misuse national marketing authorizations to delay the launch of generic versions.
It called on EU nations to speed up approvals of generic medicines that would allow them receive any price discounts offered to the original version by a national health program.
In a report, it found that generic versions often don't launch until at least seven months after the patent on the original version expires. This cost European patients some ¤3 billion more for medicines between 2000 and 2007, it said.
The European Union's 27 states spent ¤214 billion on medicines in 2007, or ¤430 per person. Most of that cost is carried by state health insurance programs.
The also said there was a decline in the number of new drugs reaching the market and «certain company practices might contribute to this phenomenon.» It gave no details but said it would closely monitor the pharmaceutical market to check what is holding back innovation.
Only 27 new types of drugs were launched from 2000 to 2004, far fewer than the 40 that hit the market from 1995 to 1999, it said.
Pharmaceutical companies are under pressure from the loss of exclusive patents over top-selling drugs and higher costs for research and development. Many _ such as Johnson & Johnson _ are cutting costs and staff to try and stay profitable.
Launched in January, the EU investigation gathered evidence from U.S.-based Pfizer, Britain's GlaxoSmithKline and Sanofi-Aventis of France _ the world's three biggest drug makers.
Investigators also raided Anglo-Swedish AstraZeneca, Merck Sharp & Dohme, Johnson & Johnson's Belgian unit, Wyeth of Madison, New Jersey, and Sandoz International GmbH, the generics division of Swiss company Novartis, and consulted hospitals, pharmacies and insurers.
EU action was partly triggered by its 2005 case against AstraZeneca in which the company was fined ¤60 million for filing misleading information to patent offices to delay generic versions of its ulcer drug Losec for most of the 1990s.