EC Probes Patent Settlements

The EC has asked certain pharmaceutical companies to submit copies of their patent-settlement agreements; in particular, the EC will be looking at settlements where an originator paid off a generic competitor in return for delayed market entry of a generic drug. The request covers patent-settlement agreements completed between originator and generic pharma companies between 1 July 2008 and 31 December 2009.

"Patent settlements are an area of concern, not least if there are situations where an originator pays off a generic competitor in return for delayed market entry," Neelie Kroes, EC Commissioner for Competition, explained in a press statement. "We need to monitor this type of agreement to better understand why, by whom, and under which conditions they are concluded. The monitoring will also provide us with the ability to act should this become necessary."

Following receipt of the responses from the pharma companies, the EC will analyze the agreements and publish a short report. If necessary, a more targeted request for information may follow. The statement says: "Depending on the outcome of the exercise, this round of information requests may be repeated annually for as long as the Commission considers that there is a problem."

The monitoring exercise was launched following the findings of the EC's competition inquiry into the pharma sector, which were published in July 2009 and which highlighted the fact that certain types of patent settlements may have a negative effect on European consumers.

http://europa.eu