UK competition regulator fines drugmakers £45 million over pay-for-delay deals

The UK’s Competition and Markets Authority announced this morning that it has fined a number of pharmaceutical companies for anti-competitive conduct and agreements relating to the supply of the antidepressant drug paroxetine.

The CMA’s decision relates to conduct and agreements between 2001 and 2004 in which UK drug major GlaxoSmithKline (LSE: GSK), the supplier of Seroxat branded paroxetine, agreed to make payments and other value transfers totalling over £50 million ($722 million) to suppliers of generic versions of paroxetine. The CMA has found that these payments and other value transfers were aimed at delaying the potential entry of generic competitors into the UK market for paroxetine.

In 2001, a number of pharmaceutical companies – including Generics (UK) Limited (GUK) and Alpharma Limited (Alpharma) – were taking steps to enter the UK market for paroxetine with a generic version. GSK’s own branded Seroxat was a ‘blockbuster’ product: In the UK, 4.2 million prescriptions were issued for Seroxat in 2000 and Seroxat sales exceeded £90 million in 2001. At the time GSK held certain patents in relation to paroxetine.