By Foo Yun Chee and Rex Merrifield
BRUSSELS Jan 31 EU regulators stepped up their
fight against drug companies suspected of blocking cheap generic
medicines, charging Johnson & Johnson and Novartis
over a painkiller called fentanyl.
The antitrust watchdog said it believed the two had agreed a
"pay-for-delay" deal on generic versions of the drug, sold under
brand names including Duragesic, hurting Dutch consumers and
Novartis and its Sandoz unit, in this case the suppliers of
the generic version, said they would examine the regulator's
"statement of objections" and would take advantage of their
rights of defence against the charges.
Johnson & Johnson's Dutch unit Janssen-Cilag said it would
cooperate with the Commission and defended the deal.
"The arrangement we had with Sandoz was legitimate. We
believe we did not infringe any rules," Janssen spokesman Stefan
It is the latest such case launched by the European
Commission after it filed charges against Merck KGaA,
Lundbeck, Servier and several other pharmaceutical
companies last year.
Regulators on both sides of the Atlantic have warned
pharmaceutical companies against agreements where brand-name
companies pay generic competitors to withhold their rival drugs
from the market, saying such deals result in additional costs
The Commission, which acts as antitrust regulator in the
27-nation European Union, said it had sent its charge sheet to
U.S.-based Johnson & Johnson and Swiss group Novartis over an
agreement between their Dutch subsidiaries.
"If our preliminary conclusions are confirmed, the Dutch
subsidiaries ... entered into a so-called 'co-promotion'
agreement to avoid competing against each other, depriving users
of fentanyl in the Netherlands from access to a cheaper
painkiller," the Commission said in a statement.
It said the agreement between Janssen-Cilag and Sandoz meant
Dutch consumers were not able to get access to cheaper generic
fentanyl from July 2005 to December 2006.
The charges arose from an investigation of the
pharmaceuticals sector after a Commission report highlighted
deals between major drugmakers aimed at hindering or blocking
generic medicines in pay-for-delay deals.
The EU executive can fine companies up to 10 percent of
their global sales for breaching EU antitrust rules.
Novartis shares were 0.2 percent lower at 62 Swiss francs by
1557 GMT, in line with the broader European pharmaceutical