Competition Appeal Tribunal upholds GSK ‘pay for delay’ decision but reduces penalties

 

Competition Appeal Tribunal upholds GSK ‘pay for delay’ decision but reduces penalties

The Competition Appeal Tribunal (CAT) has upheld a decision of the Competition and Markets Authority (CMA) finding that GlaxoSmithKline and three generic pharmaceutical manufacturers infringed competition law by entering into so-called ‘pay for delay’ agreements for the drug paroxetine.  It reduced the penalties originally imposed by the CMA by £27 million.

The agreements dated back to the early 2000s.  While the CAT upheld the substantive findings of infringement, the reduction in penalties reflects the legal uncertainty at the time of the arrangements and the novelty of the infringement.  The CAT also criticised the very substantial passage of time between the end of the violation in 2004 and the start of the CMA’s investigation.

The CAT’s decision was delayed following its referral of a number of questions to the Court of Justice.

The 77 page judgment merits a close reading.  It clarifies issues relating to market definition, competition between originators and generics and what may be considered a ‘by object’ infringement.

[2021] CAT 9, https://www.catribunal.org.uk/sites/default/files/2021-05/1251-1255_Paroxetine_Judgment_CAT9_100521.pdf