The Swiss Competition Commission (COMCO) has published its decision to discontinue its investigation against Swiss pharmaceutical company Novartis. The investigation assessed whether Novartis had engaged in alleged anti-competitive practices by purchasing a patent portfolio from Genentech, and subsequently filing patent infringement lawsuits against other pharmaceutical companies, while requesting them to license the portfolio, in order to protect its anti-psoriasis blockbuster drug Cosentyx®. Specifically, COMCO examined if Novartis' actions were based on a so-called "blocking patent" strategy that restricted production, commercialization, or technical development of other anti-psoriasis medicines.
According to the decision, COMCO found it particularly relevant
that Novartis purchased the patent portfolio to secure its own
freedom to operate in the market – a legitimate motive from a
competition law perspective. Nor was it considered anti-competitive
that Novartis requested other companies to obtain licenses, at
reasonable terms, for their anti-psoriasis products that
potentially infringed Novartis' patent portfolio, even though
Novartis enforced these requests through patent infringement
lawsuits.
The investigation determined that Novartis' conduct aligned
with standard patent law practices and found no evidence of an
unlawful restraint of competition – irrespective of whether
Novartis could be considered dominant in the anti-psoriasis
space.
Moreover, Novartis' multiple parallel actions across various
jurisdictions against a competitor raised no concerns. Evidence
showed that these actions were not part of a strategy to exclude
said competitor from the market. Instead, Novartis' continuous
negotiations throughout large parts of the period investigated by
COMCO demonstrated Novartis' genuine intent to monetize its
patent portfolio rather than restrict competition.
COMCO's decision shows that the Swiss competition authorities
are ready to strike a balance between the rationale of intellectual
property protection and competition law. COMCO seems mindful of
preserving the exclusivity rights conferred upon intellectual
property holders. This approach aligns with the Federal Supreme
Court's recent HCI Solutions judgment, which held that
contractual exclusivity provisions merely reflecting the
exclusivity conveyed by a copyright is not subject to the Swiss
Cartel Act.
The Schellenberg Wittmer team representing Novartis included David Mamane, Peter Picht, Tobias Magyar, Frank Bremer, Amalie Wijesundera, and Laura Macht.