UPDATE 2-EU antitrust charge for Servier, Teva over generics

Mon Jul 30, 2012 9:24pm IST

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* Pay-for-delay deals relate to perindopril medicine

* Servier faces a fine up to 10 pct of its turnover

* Second EU antitrust case against pay-for-delay deals

By Foo Yun Chee

BRUSSELS, July 30 (Reuters) - EU antitrust regulators charged French drugmaker Servier, Israel's Teva and four other firms on Monday with blocking the entry of a cheaper generic medicine to market as part of a crackdown on a key business practice in the industry.

The European Commission had flagged the move last week after charging nine drug companies including Germany's Merck and Danish peer Lundbeck for a similar offence related to another generic medicine.

Regulators on both sides of the Atlantic have warned drugmakers against "pay-for-delay" deals, where brand-name companies pay generic companies to abstain from putting their rival medicines on the market.

The EU regulator's cases against the companies are the first since a damning 2009 report into the industry said consumers could be paying 20 percent more for drugs because of such deals.

The Commission said on Monday that Servier had made illegal agreements with Niche, which is a subsidiary of Unichem , Matrix - which is now known as Mylan Laboratories Limited - Teva, Krka and Lupin.

"At this stage, the Commission takes the view that the patent settlement agreements concluded by Servier ... as well as Servier's acquisition of key competing technologies were aimed at delaying or preventing the market entry of cheap generic versions of perindopril, in violation of EU antitrust rules," the EU watchdog said in a statement.

Perindopril is a blood pressure medicine.

Teva, the world's biggest maker of generic drugs, said in a statement that it had not yet received the Commission's charge sheet or statement of objections.

"Once it is received, we will take some time to read and consider the document, but we do not believe that Teva entered into any anti-competitive behavior and we will co-operate fully with the authorities with their enquiry," Teva said.

The company recorded $18.3 billion in 2011 revenues.

Servier, which had 390 million euros in revenues for the 2010/2011 financial year, said in a statement that it had not yet received the formal complaint from the European Commission. The company said it planned to respond to the complaint because it was convinced it had not breached competition rules.

The companies could face a fine of up to 10 percent of its global turnover if found guilty.

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