On 19 December 2013, the French Competition Authority (FCA)
imposed a fine of € 15.3 million on pharmaceutical
company Schering-Plough for defaming a generic drug that competes
with its brand name Subutex drug and for granting unjustified price
cuts to pharmacies in breach of Article 102 TFEU.
In 1997, Schering-Plough acquired the exclusive marketing rights
of Subutex, which is used to treat the dependence of drug addicts,
from its manufacturer Reckitt Benckiser. In 2006, the generic
pharmaceutical company Arrow brought proceedings before the FCA
following difficulties in entering the market, alleging that
Schering-Plough had abused its dominant position.
In its decision, the FCA found that Schering-Plough and Reckitt
Benckiser carried out a two-prong strategy between mid-February and
May 2006 aimed at delaying and discouraging the market entry of
generics by questioning the medical equivalence of the generic
drugs. First, the pharmaceutical companies conducted a
communication campaign aimed at doctors and pharmacists shedding
doubts on the efficiency and the safety of the products of generic
competitors. Second, the FCA found that Schering-Plough granted
pharmacists illegal rebates with no objective justification, the
aim of which was to prevent their supply of generics by saturating
their stocks. The rates of the rebates also exceeded the maximum
legal cap, and the payment conditions were found to be abnormally
The FCA also found that Schering-Plough took improper measures
to influence both doctors and pharmacists to stop the generic
substitution process by, for example, convincing doctors to insert
the indication "non-substitutable" in their prescription
of Subutex to their patients, or encouraging pharmacists not to
substitute Subutex for the generic when the prescription did not
The FCA fined Schering-Plough a total amount of € 15.3
million and Reckitt Benckiser € 318,000 for conducting
the defamatory campaign and for granting the illegal rebates to
pharmacists. Schering-Plough's parent company, Merck & Co,
was fined € 414,000 for operating the illegal cartel.
This is the second time the FCA has fined a pharmaceutical
company for orchestrating a defamatory campaign aimed at delaying
the market entry of a generic. In May 2013, Sanofi-Aventis was
fined over € 40 million on the same grounds (see VBB on
Competition Law, Volume 2013, No. 5, available at
www.vbb.com). The lower fine imposed on Schering-Plough appears
to reflect the fact that it did not contest the FCA's statement
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