EC Fines Lundbeck Over 'Pay-for-Delay' Deals in Europe

Lundbeck and eight other pharmaceutical companies have been fined a total of €146 million for delaying generic entry of the blockbuster antidepressant, Celexa (citalopram), into the market.

Lundbeck and eight other pharmaceutical companies have been fined a total of €146 million by the European Commission (EC) for delaying generic entry of the blockbuster antidepressant, Celexa (citalopram), into the market.

Following a three-year investigation on Lundbeck, the EC concluded that an agreement between Lundbeck and several generic drugmakers, which effectively prevented cheaper generic versions of Celexa from entering the market, was a violation of the EU antitrust rules that prohibit anticompetitive agreements (Article 101 of the Treaty on the Functioning of the European Union – TFEU). Lundbeck incurred a fine of €93.8 million, while the other generic companies involved in the infringement, including Alpharma (now part of Zoetis), Merck KGaA, Generics UK (part of Mylan), Actavis unit Arrow and Ranbaxy, were fined a total of €52.2 million.

"It is unacceptable that a company pays off its competitors to stay out of its market and delay the entry of cheaper medicines. Agreements of this type directly harm patients and national health systems, which are already under tight budgetary constraints. The Commission will not tolerate such anticompetitive practices," said Joaquín Almunia, vice-president of the EC, in a press statement.

Celexa was Lundbeck's best-selling product for many years. Following the expiry of Lundbeck’s basic patent for the citalopram molecule, generics could have entered the market but the Danish drugmaker paid incentives to generic manufacturers, such as cash sums and stock purchases, to keep their generic versions of the drug off the market. Lundbeck also offered guaranteed profits as part of distribution agreement, according to the EC. The EC’s fines were based on its 2006 guidelines on fines (IP/06/857 and MEMO/06/256).