The French Competition Authority (“FCA”) ended the year with two punitive decisions: in both cases, the parties were severely sanctioned for obstructionist behavior.
In the first decision dated 20 December 2017, the FCA imposed a 25 million euro fine on pharmaceutical company Janssen-Cilag and its parent company Johnson & Johnson, for having prevented and then restricted the development of generic versions of its Durogesic analgesic (a medicine aimed at alleviating the pain of individuals, in particular children, suffering from cancer).
Following the expiration in 2005 of patent protection for fentanyl, the active ingredient of Durogesic, a generic version of Durogesic obtained market authorization in Germany in April 2006 and sought to extend such authorization to the other Member States, as allowed by EU law. This was granted by the EU Commission in October 2007, which directed the Member States to grant the market authorization on their respective territories within 30 days.
However, during that period of time, Janssen-Cilag was found to have contacted and requested meetings with the French Health Products Safety Agency (previously known as “AFSSAPS”), and convinced the AFSSAPS that the generic was not identical to the original drug and that it could be inefficient or even have side effects on some patients, causing additional pain.
As a result, the AFSSAPS delayed the authorization of the generic drug on the French market for over one year, which was precisely the goal Janssen-Cilag was found to have set during an internal meeting named “Team Anti Durogesic Generic”. The generic drug was finally authorized at the end of 2008, but the AFSSAPS recommended a specific medical follow-up for certain vulnerable patients if they were to switch from one fentanyl drug to another.
In addition, Janssen-Cilag was found to have conducted a smear campaign addressed to healthcare professionals, with the aim of discrediting the generic versions of Durogesic. A team of 300 medical visitors were trained for the specific purpose of getting in touch with healthcare professionals and convincing them of the potential lack of safety of the generic drugs. The pharmaceutical company was found, further, to have distorted the recommendation of the AFSSAPS, insisting that a patient should not switch from one brand of fentanyl drug to another. As a result, doctors would write “non-substitutable” on Durogesic prescriptions, thus dissuading pharmacists from selling the generic version.
Through this scheme, Janssen-Cilag was able to benefit from its monopoly on the fentanyl market for a longer period of time. Not only was the authorization delayed, but even once the generic drugs were authorized, they were infrequently used.
This resulted in considerable losses for the generic pharmaceutical companies and extra costs for patients. In view of the seriousness of such behavior, the FCA imposed a 25 million fine on Janssen-Cilag and its parent company Johnson & Johnson.
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This decision was followed the next day by decision of the FCA in the chemical industry. For the first time, the FCA sanctioned a company on the basis of Article L. 464-2 para. V of the French Commercial Code, which provides for a fine of up to 1% of the global turnover of a company that hinders an investigation of the FCA on a case.
In this case, Brenntag SA and Brenntag AG were being investigated for possible anti-competitive practices by the FCA (in particular alleged predatory pricing and pressure on providers to cease contractual relations with one of Brenntag’s competitors).
Brenntag was found to have provided incomplete, imprecise and outdated information to the FCA and further to have refused altogether to provide some material elements.
The maximum amount that Brenntag could be fined was 103 million euros as its global income amounted to 10.3 billion euros in 2016. In order to determine the proportionality of the sanction to be imposed, the FCA considered the seriousness of Brenntag’s behavior, the necessity to impose a dissuasive sanction and also the size of the company. On December 21, 2017, Brenntag was finally fined 30 million euros for obstruction of the FCA’s investigations.
Decisions: FCA 17-D-25 20 December 2017 and 17-D-27 21 December 2017