Austrian Competition Authority Brings Predatory Pricing Case Against Supplier of Oncological Medicines
On 14 May 2020, the Austrian competition authority (Bundeswettbewerbsbehörde or BWB) announced that it brought an action against an unidentified pharmaceutical company seeking a declaratory judgment that the company abused its dominant position in relation to an unspecified oncological medicine (see, attached press release in German and English).
The BWB accuses the targeted firm of engaging in predatory pricing practices in the hospital channel and thus foreclosing market access by generic pharmaceutical firms. The BWB does not name the relevant market but indicates that the firm at issue has a solid 85% market share.
The BWB’s move is unusual and stands in contrast with repeated competition enforcement activities against pharmaceutical firms alleged to have charged excessive prices for their medicines (see e.g. Van Bael & Bellis Life Sciences News Alert of 4 March 2020). While the BWB’s objective to preserve generic market entry is understandable and shared by many competition and health authorities around Europe and elsewhere, the details of the case will hopefully show whether the threat to generic market entry was structural. If not, the question arises why a transitory dent in generic sales should outweigh the interest of hospitals in securing cheap supplies of oncological medicines.