European regulators will clamp down on pay-for-delay deals in the pharmaceutical sector this month,fining Denmarks Lundbeck,Indias Ranbaxy and seven other generic drug manufacturers for limiting access of cheaper products to the market.
Following an inquiry launched in 2009,the European Commission,the EUs anti-trust regulator,will impose a significant fine on Lundbeck and lesser fines on Germanys Merck KGaA and seven smaller drug firms when it announces the sanctions later this month,two officials said.
The fines underscore the determination of EU and US regulators to break agreements that involve brand name drug companies paying generic manufacturers not to deliver cheaper drugs to the market,a process that ultimately harms consumers.
European regulators have estimated that consumers are paying up to 20 per cent more for medicines in some cases.
The Commission can fine a company up to 10 per cent of its global revenue for breaching EU antitrust laws,which in Lundbecks case would be up to euro 240 million.
The officials have given no indication of the precise size of the fines apart from to say it will be sizeable in Lundbecks case.
The fine for Lundbeck is expected to be significant,less so for the others, said one of the people,who declined to be identified because of the sensitivity of the matter.
The other companies to be fined are Generics UK,Arrow,Resolution Chemicals,Xellia Pharmaceuticals,Alpharma,AL Industrier and Indias Ranbaxy,all of them makers of generic drugs.
A spokesman for Lundbeck said the company had not been notified of any fine and believed it had done nothing wrong.
A Merck KGaA spokeswoman said the company does not comment on pending legal issues. Antoine Colombani,spokesman for competition policy at the Commission,declined to comment.
Meanwhile,a PTI report stated that when contacted,a Ranbaxy spokesperson said: “We will not like to offer any comments at this point”.