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GlaxoSmithKline Fined Over 'Pay-for-delay' Deals

Feb. 12, 2016
GSK colluded from 2001 to 2004 with potential suppliers of a generic version of Seroxat, paying them to delay production of cheaper versions.

LONDON - Britain's competition watchdog on Feb. 12 fined GlaxoSmithKline (IW 1000/124) £37.6 million (US$54.5) for entering into deals which delayed generic cheaper versions of its anti-depressant Seroxat.

The Competition and Markets Authority (CMA) said that GSK colluded from 2001 to 2004 with potential suppliers of a generic version of Seroxat, paying them a total of £50 million to delay production of cheaper versions.

The watchdog added that GSK's so-called "pay for delay" deals had resulted in higher costs for the state-run National Health Service.

GSK’s Seroxat was a blockbuster drug in 2001 when a number of firms were seeking to produce their own generic product.

"These ‘pay-for-delay’ agreements deferred the competition that the threat of independent generic entry could offer, and potentially deprived the National Health Service of the significant price falls that generally result from generic competition,” the CMA said.

GSK said in a separate statement that it disagreed with the CMA’s ruling, adding that the deals it struck with generics makers were to “settle costly, complex and uncertain patent disputes.”

The regulator handed out fines totaling £7.4 million also to Activis UK, Alpharma Generics UK, Merck and Xellia Pharmaceuticals.

Copyright Agence France-Presse, 2016

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