On July 11, 2019, the Paris Court of Appeals dismissed most of the pharmaceutical company Janssen-Cilag’s claims in its appeal against the FCA decision fining it for delaying market entry of a generic drug[1], thereby essentially upholding the FCA’s third decision fining a pharmaceutical company for denigrating generic drugs after Sanofi-Aventis[2] and Schering-Plough.[3]

Janssen-Cilag markets an originator drug, Durogesic, a strong painkiller for patients with chronic cancer pain, distributed in the form of fentanyl patches. In October 2007, shortly after Janssen-Cilag’s patent over Durogesic expired, the European Commission granted a generic drug market authorization to Ratiopharm and ordered national regulatory authorities to follow in doing so. The French health authority (the “AFSSAPS”) thus initiated a procedure to grant Ratiopharm a market authorization in France. In March 2008, Janssen-Cilag submitted to the AFSSAPS that Ratiopharm’s generic drug (i) failed to qualify as a generic form of Durogesic and (ii) could have adverse effects on public health. The AFSSAPS ultimately granted its market authorization in July 2008, while it was legally bound to issue it within 30 days of the notification of the European Commission’s market authorization. In January 2009, the AFSSAPS registered Ratiopharm’s generic drug on the French repertoire of generic drugs, but alerted pharmacists on some existing risks for patients substituting Durogesic with the generic drug. Janssen-Cilag then launched a campaign disparaging the generic versions of Durogesic among doctors and pharmacists. Ratiopharm complained about Janssen-Cilag’s intervention before the FCA and its communication among doctors and pharmacists.

In December 2017, the FCA fined Janssen-Cilag 25 million euros for delaying and then blocking the market entry of generic versions of Durogesic in France in violation of Article 102 TFEU.[4]

Janssen-Cilag appealed the FCA decision. It claimed that (i) the FCA lacked jurisdiction to assess its intervention before the AFSSAPS; (ii) neither its intervention before the AFSSAPS nor its communication with doctors and pharmacists were anticompetitive under Article 102 TFEU; and (iii) the fine should be reduced.

The Paris Court of Appeals rejected the first two arguments—but slightly reduced the fine on the ground that the damage to the economy was lower than found by the FCA.

First, the Court confirmed that the FCA had jurisdiction to assess an undertaking’s conduct before an independent regulatory authority. The Court noted that the FCA had not intruded on the scientific debate on Durogesic’s generic drugs. Instead, the FCA had carried out a legal analysis assessing whether Janssen-Cilag’s conduct sought to preserve its dominant position, which was in the scope of its jurisdiction.

Second, the Court confirmed that Janssen-Cilag’s conduct was anticompetitive under Article 102 TFEU. It noted that a conduct consisting, for a dominant firm, of putting forward arguments known or which ought to be known as legally unfounded before an independent regulatory authority can reduce competition. The Court held that, in this case, the FCA had rightfully found that Janssen-Cilag had abused its dominant position by challenging the qualification of Ratiopharm’s drug as a generic before the AFSSAPS while (i) the European Commission had already settled this point, and the AFSSAPS was bound by this determination; and (ii) re-opening the discussions with the AFSSAPS would likely delay the generic’s registration on the French repertoire, thereby reducing competition on the market. Further, the Court confirmed that Janssen-Cilag had denigrated Ratiopharm’s generic by carrying out a campaign vis-à-vis pharmacists, falsely claiming that the AFSSAPS was not convinced of Ratiopharm’s drug qualification as a generic and that the generic could not replace the Durogesic without risk.

Nevertheless, the Court reduced the fine imposed on Janssen-Cilag. It held that the FCA had incorrectly found that Janssen-Cilag’s intervention delayed the issuance of AFSSAPS’ market authorization. Indeed, Janssen-Cilag first reached out to the AFSSAPS at the end of March 2008, and the AFSSAPS had already issued opinions on Ratiopharm’s generic by then. Instead, Janssen-Cilag’s intervention aimed at delaying the registration of the generic on the French repertoire. While this hindered pharmacists’ prescribing the generic for patients using Durogesic, it did not prevent the generic from being marketed. As a result, the damage to the economy was less serious than that fined by the FCA. The Court reduced the proportion of the value of sales from 15% to 13%, resulting in a total fine of 21 million euros.

[1]              Paris Court of Appeals, 5-7, July 11, 2019, RG No. 18/01945.

[2]              French Competition Authority, Decision No. 13-D-11 of May 14, 2013, relating to practices in the pharmaceutical sector.

[3]              French Competition Authority, Decision No. 13-D-21 of December 18, 2013 relating to practices on the French market of high dose buprenorphine marketed in towns.

[4]              French Competition Authority, Decision No. 17-D-25, December 20, 2017, relating to practices in the sector of transdermal systems of fentanyl.