EU actively pursuing some drugmakers, official says

EU regulators are probing some drug firms over suspected anti-competitive practices that include deals with makers of cheap generics to delay medicines’ market entry, a European Commission official said on Tuesday.

European Union Competition Commissioner Neelie Kroes will say in a report on the pharmaceutical industry on Wednesday that “we are actively pursuing a number of individual cases,” said the official, who has seen the 600-page document.

“The report will say that there are no final conclusions at this stage to those cases being pursued,” the official said, adding that the document did not identify any companies.

Kroes, tasked with ensuring fair play across the 27-country European Union, will present the final report of her investigation at 0930 GMT.

In its preliminary report last November, the EU’s executive arm estimated that delays in getting generics on the market had cost healthcare providers 3 billion euros ($4.2 billion), based on a sample of medicines that lost patent protection in 17 EU states between 2000 and 2007.

The European Commission’s final report will pave the way for increased regulatory scrutiny of settlement agreements in which brand-name companies pay generics makers for not competing with them or set restrictions on competition, the official said.

“It will look at this on a case-by-case basis to see if there is enough evidence that merits further scrutiny,” the official said.

Kroes kicked off her investigation in January 2008 with a series of raids on makers of brand-name drugs, including AstraZeneca, GlaxoSmithKline, Merck and Sanofi-Aventis.

There were also raids on generic drugmakers suspected of colluding to delay the entry of their products, sometimes in exchange for payments from originator companies.

Such settlement agreements have also come under fire in the United States, where the Federal Trade Commission estimated last month that they were costing consumers $3.5 billion a year.

Legislation pending in the U.S. Congress would ban such deals.

Drugmakers blame most of the delays on regulatory and other bureaucratic issues, rather than deliberate action by companies.

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* EU actively pursuing a number of individual cases

* No conclusions at this stage

* Kroes report to step up scrutiny of generics deals

By Foo Yun Chee