The European Commission has opened a formal antitrust investigation to assess whether the pharmaceutical company Teva Pharmaceutical Industries Ltd. has illegally delayed the market entry and uptake of medicines that compete with Copaxone, its blockbuster multiple sclerosis drug. The EC will investigate whether Teva has abused a dominant market position in breach of EU antitrust rules.

Teva is headquartered in Israel and operates from several subsidiaries in the European Economic Area. EC launched surprise inspections of Teva subsidiaries in 2019 and continued its inspections at EC offices in Brussels.

Copaxone, Teva's best-selling drug, is widely used for the treatment of relapsing forms of multiple sclerosis and contains the active pharmaceutical ingredient glatiramer acetate.

Executive Vice-President Margrethe Vestager, head of EC competition policy, said MS affects the lives of more than half a million Europeans who require life-long treatment. Despite great efforts of the scientific community, she noted, the disease remains incurable. “It is therefore paramount to preserve healthy competition in the market for available drugs that aim at slowing down the disease and improving patients' quality of life,” Vestager said. “It is also important that companies compete to innovate so that new and affordable treatments can emerge.”

According to the EC, Teva's basic patent covering glatiramer acetate expired in 2015. The EC will investigate whether, following the patent expiry, Teva artificially extended the market exclusivity of Copaxone by strategically filing and withdrawing divisional patents, repeatedly delaying entry of its generic competitor which had to file a new legal challenge each time.

Divisional patents originate from a broader parent patent and may cover significantly overlapping inventions, sometimes allowing the patentee to multiply the patent barriers that a generic competitor needs to overcome to enter the market.

This strategy puts an indefinite number of barriers in front of potential competitors, unduly delaying a viable competitor from entering the market, which the EC may find amounts to an abuse of a dominant position under Article 102 of the Treaty on the Functioning of the European Union.

In addition, the EC will examine whether Teva pursued a campaign to hinder the use of competing glatiramer acetate products. The EC says it has indications that Teva's campaign, primarily directed at healthcare institutions and professionals, may have targeted competing products to create a false perception of health risks associated with their use, even following the approval of these medicines by competent public health authorities.

An EC spokesperson told us that the Teva companies can now examine documents in the investigation file, reply in writing, and request an oral hearing to before the EC and national competition authorities. There is no deadline for concluding such an investigation, she added. Teva has said it is cooperating with the investigation.

Edited by Tom Hagy for MoginRubin LLP.