Misuse of patent procedures and exclusionary disparagement – a possible abuse of dominance

The European Commission investigates Teva, a global, pharmaceutical company, for possible, anti-competitive abusive conduct, partly by artificially extending its patent-based exclusivity relating to Copaxone – a bestselling drug in the treatment of multiple sclerosis – and partly by exclusionary disparagement of competing products. The latter alleged abuse is the first of its kind investigated by the European Commission, while possible misuse of patent procedures is in line with previous cases and the report from 2019.

Teva is a global pharmaceutical company operating in the EU/EEA-area and produces a wide-range of molecules and a large portfolio of products, spanning generics, specialty and over the counter medicines. One of their best-selling drugs, Copaxone, contains the active pharmaceutical ingredient glatiramer acetate. This ingredient is widely used for the treatment of multiple sclerosis (“MS”), and was covered by Teva’s basic patent until 2015.

In 2019 and 2020, the European Commission (the “Commission”) carried out unannounced inspections at several of Teva’s premises in the EEA-area.

According to the Commission’s press release 4 of March 2021, misuses of patent procedures and alleged exclusionary disparagement have frequently been reported as important barriers to entry for generic or biosimilar medicines.

On this background, the Commission has opened formal investigation to assess whether Teva may have artificially extended the patent protection and thereby Teva’s market exclusivity of Copaxone by “strategically filing and withdrawing divisional patents, repeatedly delaying entry of its generic competitor who was obliged to file a new legal challenge each time“. Investigations for this type of possible abuse is in line with the Commission’s findings and priorities set out in its report “Competition Enforcement in the Pharmaceutical Sector” from 2019. Kvale has previously commented on this report.

The statement from the Commission also indicates another possible abuse; whereby Teva is alleged to have launched a communication campaign primarily directed at healthcare institutions and professionals which “may have targeted competing products to create a false perception of health risks associated with their use, even following the approval of these medicines by competent public health authorities“.

It is worth noting that the Commission highlights the possibility for there to be an abuse by the use of communication campaigns aiming to prevent competition by spreading false information about health risks of competing products. This type of conduct is usually sanctioned by other prohibitions relating to false advertising. To our knowledge this is the first time the Commission will consider this type of behaviour as a possible abuse.

Kvale has extensive experience in advising clients in anti-competitive as well as pharmaceutical regulatory issues and pays high attention to the following developments in the case.