GSK accused of paying off rivals

The UK’s Office of Fair Trading (OFT) has accused GlaxoSmithKline of paying generic manufacturers to delay the production of a generic equivalent of its antidepressant paroxetine, which it makes in Cork.

The OFT alleged that GSK concluded anti-competitive agreements with Alpharma, Generics (UK) and Norton Healthcare over the supply of paroxetine — a top-selling medicine sold by GSK under the brand name Seroxat.

The most recent figures show that in Ireland, the primary care reimbursement service paid €1.8m to fill over 100,000 prescriptions for paroxetine in 2011.

The British watchdog said the agreements included substantial payments from GSK to the generic companies in return for their commitment to delay launching products. This amounted to an abuse of GSK’s dominant market position, it said.

GSK disputes the allegations, which relate to deals that were effective between 2001 and 2004. The drug did not come off patent in Ireland until 2006.

“GSK supports fair competition and we very strongly believe that we acted within the law, as the holder of valid patents for paroxetine, in entering the agreements under investigation. These arrangements resulted in other paroxetine products entering the market before GSK’s patents had expired,” a GSK spokesperson said.

A third party came to the OFT in 2010 and reported the allegations to the body. The OFT began an investigation in 2011 and yesterday issued a statement of objections outlining the claims.

The Irish equivalent of the OFT, the Competition Authority, said: “It would not be appropriate for us to comment on a specific investigation being undertaken by a competition authority in another jurisdiction either.

“However, we are active members of the European Competition Network, which is made up of the competition authorities of all EU member states, and we co-operate with other members of the ECN in many different ways, including on specific cases where the alleged infringements may affect competition in Ireland a well as in the other jurisdiction.”

The companies will have an opportunity to respond to the allegations before the OFT decides if competition law has been infringed.

The issue of brand-name pharmaceutical companies paying makers of generics to drop patent challenges was also at the centre of a European review of the sector in 2008-9, which did not result in any action against GSK.