Dive Brief:
- The Competition and Markets Authority in the U.K. fined GlaxoSmithKline $54.4 million for pay-for-delay deals made with generic drugmakers between 2001 and 2004 to slow market entry of generic Seroxat.
- The fine is intended to compensate the U.K. government for having to pay higher prices for drugs which otherwise would have been available in cheaper generic versions.
- GSK said it did nothing wrong, claiming the deals actually enabled the generic companies to enter the market earlier, according to Bloomberg.
Dive Insight:
In 2001, the antidepressant Seroxat notched £90 million in sales for GSK. But other companies, including Generics UK and Alpharma Ltd., were moving to develop a generic. The CMA found GSK paid about £50 million between 2001 and 2004 to delay entry. After generic versions of the drug became available in 2003, average prices dropped 70% lower over the following two years.
Even though the deals in question were made more than a decade ago, U.K. regulators wanted to send the industry a strong signal that anti-competitive practices would be addressed.
The CMA previously fined Johnson & Johnson and Novartis roughly $22 million for similar practices which slowed generic development of the cancer pain drug fentanyl.