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Sector Probe

On 8th July 2009, the European Commission published its long-awaited final report on its inquiry into the pharmaceutical sector. The Final Report lays out the Commission’s factual findings on the state of competition in the EU pharmaceutical sector and identifies a number of areas where the regulatory framework may be influencing the entry of generic drugs. The Final Report echoes many of the findings from the Commission’s Preliminary Report of 28th November 2008, although the Commission has clearly retreated from its tone of criticism of the originator industry in that earlier report.

The Final Report points to broad areas of antitrust concern around practices allegedly used by pharmaceutical companies to delay the entry of generic and new innovative drugs, with patent settlement arrangements a subject of particular concern. While the Commission announced the opening of an antitrust investigation against an originator company and five generic companies at the time of publication of the Final Report, it remains unclear how many antitrust cases will be brought.

Somewhat disappointingly, the Final Report does not offer detailed guidance on the circumstances in which EC competition law may place limits on the ability of pharmaceutical companies to exercise their patent rights and when conduct before the regulatory authorities may be considered unlawful.

BACKGROUND - THE STORY SO FAR

The Final Report represents the culmination of an 18-month process, which began in January 2008 with a series of unannounced inspection visits on the premises of several European pharmaceutical companies to examine why fewer new medicines have been brought to the market, and why generic entry appears to be delayed. This was the first time that the Commission used dawn raids in a sector inquiry, which is indicative of the seriousness with which it views the issues.


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Catriona Hatton is the Managing Partner of Hogan and Hartson’s Brussels office and Co-Head of the European antitrust practice. Her practice focuses on EC competition law. Catriona has been practicing EC law in Brussels for more than 15 years, and has extensive experience advising on EC and national competition law aspects of international mergers. She has represented clients in complaints to, and investigations by, the European Commission and numerous national competition authorities. Her practice includes advising on compliance with the competition rules in a wide range of commercial agreements, including distribution, research and development, technology licensing, franchising, and joint ventures.

Suzanne Rab advises clients across all areas of European and UK antitrust law. She has particular experience advising on transactions and behavioural matters, including in proceedings before the UK competition authorities and the European Commission. She has worked on some of the most high-profile market and cartel investigations in Europe. Suzanne regularly speaks at conferences, presenting on a variety of competitionrelated topics including UK cartel regulation, and the role of economics in competition cases. She also frequently contributes to a number of leading legal and trade publications.

Jean-Michel Coumes’ practice focuses on EU and French competition law. Jean-Michel has been practicing all aspects of EU competition law for more than 15 years. He has extensive experience in EU and national merger control, including filing and advising major clients in complex merger cases before the European Commission and the French Conseil de la concurrence, as well as under the merger laws of EU Member States and other countries around the world. Jean-Michel represents major companies in complaints to and investigations before the European Commission in relation to the application of Articles 81 and 82. He represents companies in sectors such as IT, energy, food, telecommunications, sports, aviation, hospitality and automotive.

David Cardwell’s practice focuses on the area of European competition law. He advises clients on competition law issues associated with EU and international merger control regulations, including the coordination of cross-border merger filings in and outside the EU. David also advises clients on the application of EU law to agreements and arrangements between competitors. He is involved in work connected with the application of EU competition law to the transportation sector. Prior to joining Hogan & Hartson, David completed his training at the Edinburgh and London offices of a leading UK-based law firm. He has written articles on EU sector inquiries as well as contributed to numerous articles on a variety of subjects, including parallel imports in the pharmaceutical industry, and issues surrounding online retail distribution.

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Catriona Hatton
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Suzanne Rab
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Jean-Michel Coumes
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David Cardwell
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