By Dow Jones Business News,
December 10, 2013, 09:43:00 AM EDT
EU Fines Johnson & Johnson EUR11 Million, Novartis EUR5 Million
BRUSSELS--European Union regulators Tuesday fined U.S. pharmaceutical and health-care company Johnson & Johnson (J&J)
and Switzerland'sNovartis AG (NOVN.VX) a combined 16 million euros ($21.98 million) for their collusion in delaying the
market entry of a generic painkiller in The Netherlands.
The European Commission said J&J would be fined EUR10.8 million and Novartis EUR5.5 million after their respective
Dutch subsidiaries made a pact in 2005 to not distribute a cheaper generic version of the painkiller fentanyl in the
Netherlands. Fentanyl is used for cancer patients and is a pain-killer 100 times more potent than morphine, the
"The two companies shockingly deprived patients in the Netherlands, including people suffering from cancer, from
access to a cheaper version of this medicine," the EU's antitrust chief, Joaquin Almunia, said in a statement. "Today's
decision should make pharmaceutical companies think twice before engaging in such anticompetitive practices, which harm
both patients and taxpayers."
Regulators said that Sandoz, Novartis' Dutch subsidiary, had been poised to start distributing its generic fentanyl
supplies but then signed a so-called "co-promotion agreement" with Janssen-Cilag, J&J's Dutch arm, which gave it "strong
incentives" to withhold the drugs from the market.
According to the commission, which acts as the EU's antitrust watchdog, the agreed monthly payments exceeded the
profits that Sandoz expected to obtain from selling its generic product. That deal ended in December 2006 when a third
party was about to launch a generic fentanyl patch.
The commission also quoted internal documents showing that Sandoz agreed to abstain from entering the Dutch market in
exchange for "a part of [the] cake."
Regulators said they had taken into account the duration of the infringement and its gravity when it set the fines.
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