Servier Suspected Of Misleading European Commission In EU Anti-Trust Probe
This article was originally published in The Pink Sheet Daily
Executive Summary
Specifics of the accusations against the French pharma aren't clear, but it could face a fine amounting to 1 percent of annual sales.
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The European Commission has accused French pharmaceutical company Groupe Servier of supplying misleading information in relation to an ongoing anti-trust investigation. The answers provided by Servier in response to a request for information in the context of the pharmaceutical competition sector inquiry appeared to be disingenuous, the EC stated in a provisional opinion that was part of a Statement of Objections issued on July 26. If the EC's suspicions that Servier provided misleading information either intentionally or negligently are proven, the company could be slapped with a fine amounting to 1 percent of its annual turnover in the preceding business year (€3.6 billion in 2009). A Statement of Objections is a formal step that may be issued during EC investigations into suspected procedural violations. Servier will need to examine the documents in the EC's investigation file, reply in writing, and request an oral hearing in order to present its viewpoint to EC representatives and national competition authorities. The EC has stressed that the Statement of Objections will not prejudge the final outcome of the investigation. Servier has acknowledged receipt of the Statement of Objections from the EC, but has chosen to make no further comment. It insists that it is fully co-operating with the commission. The pharmaceutical manufacturer has been under scrutiny since July 8, 2009, when the EC announced that it was opening a formal antitrust investigation against the company for suspected breaches of the EC Treaty rules on restrictive business practices and abuse of a dominant market position. The move followed unannounced inspections carried out by the EC in November 2008 in several EU countries on suspicion of breaches of EU antitrust rules. The decision also concerned a number of generic companies, including Krka d.d., Lupin Limited, Matrix Laboratories (a subsidiary of Mylan Inc.), Niche Generics Limited (a subsidiary of Unichem Laboratories Limited) and Teva UK, as the EC suspected them of have entered into individual, possibly restrictive, agreements with Servier (Also see "Taiwan Liposome Company Nearing IPO After Round Of Financing" - Scrip, 9 Jul, 2009.). Whilst there is no legal deadline for the completion of the enquiry, the duration depends on a number of factors, including the complexity of each case, the extent to which the undertakings co-operate with theEC and their exercise of rights of defense. -Faraz Kermani ([email protected]) |