GSK appeal against fine over 'pay-for-delay' drug deals faces EU rebuke

[January 22, 2020]  BRUSSELS (Reuters) - British drugmaker GlaxoSmithKline may have harmed competition with payments it made to generic drugmakers to delay the launch of cheap copies of an antidepressant, according to an adviser to the European Court of Justice.

The legal opinion, which is not binding on the court but carries a significant weight, effectively upholds a penalty of 37.6 million pounds ($49 million) imposed by Britain's competition watchdog in 2016.

The Competition and Markets Authority (CMA) said that between 2001 and 2004, GSK paid generic drug companies over 50 million pounds with the intention of delaying the release of cheap generic versions of its former blockbuster Seroxat after its patent expired in 1999.

These so-called pay-for-delay deals "may be regarded as a restriction of competition," EU's court advocate-general Juliane Kokott said on Wednesday.

GSK had said the deals settled disputes with generic drugmakers and had challenged the CMA fine before a British appeal tribunal, which sought guidance with the EU court about whether these settlements might breach competition rules.

"An agreement in settlement of a patent dispute may constitute a restriction of competition," the court's legal adviser said.

"Entering into such an agreement may be an abuse of a dominant position," she added in her opinion.

In most cases the court confirms in its definitive rulings the opinions issued by its advisers.

(Reporting by Francesco Guarascio @fraguarascio; editing by Philip Blenkinsop and Barbara Lewis)

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