The jurisprudence of the European Court of Justice (ECJ) and the
Court of First Instance (CFI) has examined with some frequency the rules
applicable to the pharmaceutical industry as they relate to parallel trade.
The cases have, at times, focused on the free movement of goods principles
and, at other times, the competition rules. In some instances, the European
Commission has used the intent of the companies as set forth in
documents to suggest and/or establish a breach of the competition rules.
More recently, the European Commission launched a pharmaceutical
sector inquiry that focused on innovator and generic companies, in
particular whether patent portfolios, litigation (and settlements) and
regulatory actions by innovative companies caused “undue delay” in
generic entry. In both the preliminary and final reports, the alleged intent
of companies as set forth in numerous quotations from documents found
in the companies files during unannounced inspections (or “dawn raids”
by the European Commission) was used to imply the existence of
anticompetitive motives by the pharmaceutical companies, and suggest
that the conduct of innovator companies was intended to cause and had
caused undue delay to generic entry.
This paper looks at the role of intent and the jurisprudence as it has
developed with regard to parallel trade in the pharmaceutical industry
over the past 40 years and also in the pharmaceutical sector inquiry. It
would appear that the Directorate General responsible for competition
matters (DG Comp) of the European Commission is suspicious of the
innovative pharmaceutical industry. As DG Comp may have continued
and renewed interest in the pharmaceutical sector with regard to
innovator company conduct relating to generics, it is worthwhile exploring
how the jurisprudence has developed and why issues have re-surfaced
and been the subject of repeated challenges before the CFI and ECJ. The
role of intent and how it is used needs to be better understood.