Judgments nº T-472/13 of The General Court, September 08, 2016

Resolution DateSeptember 08, 2016
Issuing OrganizationThe General Court
Decision NumberT-472/13

(Competition - Agreements, decisions and concerted practices - Market for antidepressant medicinal products containing the active pharmaceutical ingredient citalopram - Concept of restriction of competition ‘by object’ - Potential competition - Generic medicinal products - Barriers to market entry resulting from the existence of patents - Agreements concluded between a patent holder and generic undertakings - Article 101(1) and (3) TFEU - Errors of law and of assessment - Obligation to state reasons - Rights of defence - Legal certainty - Fines)

In Case T-472/13,

H. Lundbeck A/S, established in Valby (Denmark),

and

Lundbeck Ltd, established in Milton Keynes (United Kingdom),

represented by R. Subiotto QC, and T. Kuhn, lawyer,

applicants,

supported by

European Federation of Pharmaceutical Industries and Associations (EFPIA), established in Geneva (Switzerland), represented by F. Carlin, Barrister, and M. Healy, Solicitor,

intervener,

v

European Commission, represented initially by J. Bourke, F. Castilla Contreras, B. Mongin, T. Vecchi and C. Vollrath, and subsequently by F. Castilla Contreras, B. Mongin, T. Vecchi, C. Vollrath and T. Christoforou, acting as Agents,

defendant,

APPLICATION for annulment in part of Commission Decision C(2013) 3803 final of 19 June 2013 relating to a proceeding under Article 101 [TFEU] and Article 53 of the EEA Agreement (Case AT.39226 - Lundbeck) and for reduction of the amount of the fine imposed on the applicants by that decision,

THE GENERAL COURT (Ninth Chamber),

composed of G. Berardis (Rapporteur), President, O. Czúcz and A. Popescu, Judges

Registrar: L. Grzegorczyk, Administrator,

having regard to the written procedure and further to the hearing on 26 November 2015,

gives the following

Judgment

Summary of the facts and background to the dispute

I - The companies involved in the present case

1 H. Lundbeck A/S (‘Lundbeck’) is a company governed by Danish law which controls a group of companies, including Lundbeck Ltd, established in the United Kingdom, specialising in the research, development, manufacture, marketing, sale and distribution of pharmaceuticals for the treatment of disorders in the central nervous system, including depression.

2 Lundbeck is an ‘originator’ undertaking, namely an undertaking whose activities are focused on researching new medicinal products and bringing them to the market.

3 Merck KGaA (‘Merck’) is a company governed by German law specialising in the pharmaceutical sector which, at the time the agreements concerned were concluded, indirectly held 100% - through the group Merck Generics Holding GmbH (‘Merck Generics’) - of its subsidiary Generics UK Limited (‘GUK’), a company responsible for the development and marketing of generic pharmaceutical products in the United Kingdom.

4 The Commission regarded Merck and GUK as constituting a single undertaking for the purpose of competition law at the time of the infringements (‘Merck (GUK)’).

5 Arrow Group A/S, which was renamed Arrow Group ApS in August 2003 (hereinafter referred to without distinction as ‘Arrow Group’), is a company governed by Danish law at the head of a group of companies, present in several Member States, which since 2001 has been active in the development and sales of generic medicinal products.

6 Arrow Generics Ltd is a company incorporated in the United Kingdom, a subsidiary owned at first as to 100% and then, from February 2002, as to 76% by Arrow Group.

7 Resolution Chemicals Ltd is a company incorporated in the United Kingdom specialising in the production of active pharmaceutical ingredients (‘APIs’) for generic medicinal products. Until September 2009 it was controlled by Arrow Group.

8 The Commission regarded Arrow Group, Arrow Generics Ltd and Resolution Chemicals Ltd as constituting a single undertaking (‘Arrow’) at the time of the infringements.

9 Alpharma Inc. was a company incorporated in the United States of America active in the pharmaceutical sector on a worldwide scale, in particular in generic medicinal products. Until December 2008 it was controlled by A.L. Industrier AS, a company governed by Norwegian law. It was subsequently bought by a United Kingdom pharmaceutical undertaking, which, in turn, was bought by a United States pharmaceutical undertaking. In the context of those restructurings, Alpharma Inc. became, first of all, in April 2010, Alpharma LLC, and then, on 15 April 2013, Zoetis Products LLC.

10 Alpharma ApS was a company governed by Danish law indirectly controlled as to 100% by Alpharma Inc. It had a number of subsidiaries in the European Economic Area (EEA). Following a number of company restructurings, on 31 March 2008 Alpharma ApS became Axellia Pharmaceuticals ApS, renamed Xellia Pharmaceuticals ApS (‘Xellia’) in 2010.

11 The Commission regarded Alpharma Inc., A.L. Industrier AS and Alpharma ApS as constituting a single undertaking (‘Alpharma’) at the time of the infringements.

12 Ranbaxy Laboratories Ltd is a company governed by Indian law specialising in the development and production of APIs and generic medicinal products.

13 Ranbaxy (UK) Ltd is a company governed by English law and a subsidiary of Ranbaxy Laboratories and is responsible for the sale of the latter’s products in the United Kingdom.

14 The Commission regarded Ranbaxy Laboratories Ltd and Ranbaxy (UK) Ltd as constituting a single undertaking (‘Ranbaxy’) at the time of the infringements.

II - The relevant product and the applicable patents

15 The relevant product for the purposes of the present case is the antidepressant medicinal product containing the API known as citalopram.

16 In 1977, Lundbeck filed a patent application in Denmark for the citalopram API and two processes - a cyanation process and an alkylation process - to produce that API. Patents for that API and those two processes (‘the original patents’) were issued in Denmark and in a number of Western European countries between 1977 and 1985.

17 As regards the European Economic Area (EEA), the protection afforded by the original patents and, where appropriate, the supplementary protection certificates (‘SPCs’) provided for in Council Regulation (EEC) No 1768/92 of 18 June 1992 concerning the creation of a supplementary protection certificate for medicinal products (OJ 1992 L 182, p. 1), expired between 1994 (as regards Germany) and 2003 (as regards Austria). In particular, in the case of the United Kingdom, the original patents expired in January 2002.

18 Over time, Lundbeck developed other, more effective, processes for the production of citalopram, in respect of which it applied for and often obtained patents in several EEA countries and also from the World Intellectual Property Organisation (WIPO) and the European Patent Office (EPO) (‘Lundbeck’s new patents’).

19 In particular, first, in 1998 and in 1999 Lundbeck applied to the EPO for two patents relating to the production of citalopram by processes using iodo and amide, respectively. The EPO granted Lundbeck a patent protecting the process using amide (‘the amide patent’) on 19 September 2001 and a patent protecting the process using the iodo (‘the iodo patent’) on 26 March 2003.

20 Secondly, on 13 March 2000 Lundbeck filed a patent application with the Danish authorities relating to a process for the production of citalopram which envisaged a method of purification of the salts used by means of crystallisation. Similar applications were filed in other EEA countries and also with the WIPO and the EPO. Lundbeck obtained patents protecting the crystallisation process in a number of Member States during the first half of 2002: 30 January 2002 in the case of the United Kingdom (‘the crystallisation patent’). The EPO granted a crystallisation patent on 4 September 2002. In addition, in the Netherlands, Lundbeck had already obtained, on 6 November 2000, a utility model for that process (‘Lundbeck’s utility model’), that is to say, a patent valid for six years, granted without a genuine prior examination.

21 Thirdly, on 12 March 2001, Lundbeck filed a patent application with the United Kingdom authorities for a citalopram production process using a salt purification method by film distillation. The United Kingdom authorities granted Lundbeck a patent for that film distillation method on 3 October 2001 (‘the film distillation patent’). However, that patent was revoked on 23 June 2004 for lack of novelty by comparison with another Lundbeck patent. Lundbeck obtained a similar patent in Denmark on 29 June 2002.

22 Lastly, Lundbeck planned to launch a new antidepressant medicinal product, Cipralex, based on the API known as escitalopram (or S-citalopram), by the end of 2002 or the beginning of 2003. That new medicinal product was designed for the same patients as those who could be treated by Lundbeck’s patented medicinal product Cipramil, based on the citalopram API. The escitalopram API was protected by patents valid until at least 2012.

III - The agreements at issue

23 In 2002, Lundbeck entered into six agreements concerning citalopram (‘the agreements at issue’) with four undertakings active in the production and/or sale of generic medicinal products, namely Merck (GUK), Alpharma, Arrow and Ranbaxy (‘the generic undertakings’).

A - The agreements with Merck (GUK)

24 Lundbeck entered into two agreements with Merck (GUK).

25 The first agreement came into effect on 24 January 2002 for a period of one year, and covered only the territory of the United Kingdom (‘the GUK United Kingdom agreement’). It was signed by Lundbeck A/S’s subsidiary, Lundbeck Ltd, a company incorporated in the United Kingdom. That agreement was subsequently extended for a period of six months, ending on 31 July 2003. Next, after Merck (GUK) briefly entered the market between 1 and 4 August, a second extension of the agreement was signed by the parties on 6 August 2003, for a maximum period of six months, which could be reduced if Lundbeck failed to initiate legal proceedings...

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