Commission investigation into anticompetitive disparagement ends with commitments

The European Commission ("Commission") has formally accepted commitments from Vifor in relation to its investigation into alleged disparagement of competitor drug Monofer.

This is the first Commission decision relating to exclusionary disparagement of competing products in the pharmaceutical industry as an abuse of dominance. The decision makes the commitments legally binding, closing the investigation, but is not a finding of infringement.

The case is also interesting as Vifor and complainant Pharmacosmos reached a confidential commercial settlement agreement, which the Commission took into consideration in its decision to explore closing the case with commitments rather than a finding of infringement (which would have led to it fining Vifor).

The Commission has a second investigation relating to disparagement (among other things) ongoing into Teva and its multiple sclerosis drug Copaxone. In that investigation the Commission issued a statement of objections in October 2022, as we reported in our blogpost here. The Commission's (informal) investigation into Edwards Lifesciences appears to include allegations of disparagement (among other things).

Although the Commission has not yet published its Vifor decision, it has published some information in its press release. In this blogpost we provide an overview of the case and its importance for companies in the pharmaceutical sector.

For further details on EU competition law in the pharmaceutical sector more generally, please see our recent chapter in Lexology's Getting the Deal Through: Pharmaceutical Antitrust, available here.

Background

Vifor is a global pharmaceutical company, part of the CSL biotechnology group. It manufactures, among other products, iron deficiency treatments, including the intravenous product Ferinject.

The Commission considered that Vifor's closest competitor in the relevant product markets is Pharmacosmos, which focuses on iron deficiency treatments including the intravenous product Monofer. Both Ferinject and Monofer are high-dose treatments which are used when oral treatments are ineffective or cannot be used.

In June 2022 the Commission opened a formal investigation into Vifor after Pharmacosmos filed a complaint alleging that Vifor was disparaging Monofer by spreading misleading information regarding its safety.

In February 2024, Vifor and Pharmacosmos reached a confidential commercial settlement agreement relating to this matter. The Commission took this into consideration in its decision to explore settling the case under its commitments procedure.

In April 2024, the Commission adopted a preliminary assessment summarising the main facts of the case and identifying its preliminary competition concerns.

The Commission's preliminary findings

The Commission preliminarily found that Vifor holds a dominant position in the market for intravenous iron treatment products in Austria, Finland, Germany, Ireland, Portugal, Romania, Spain, Sweden and the Netherlands.

The Commission is concerned that "for many years, Vifor may have restricted competition in [these markets] by disseminating potentially misleading information about the safety of Monofer" (emphasis added).

It considers that these messages, primarily targeting healthcare professionals, may have unduly hindered Monofer's uptake, and appear to be aimed at shielding Vifor's blockbuster Ferinject from competition.

On this basis, the Commission took the preliminary view that Vifor's conduct may have restricted competition in the market for intravenous iron treatment and potentially amount to an abuse of dominant position, in breach of Article 102 of the Treaty on the Functioning of the European Union ("TFEU").

The commitments

Following the Commission's preliminary findings, Vifor offered commitments to seek to address the Commission's concerns and settle the case. The Commission tested these publicly and with market participants between 22 April and 22 May 2024. In light of the responses and following negotiations with the Commission, Vifor adjusted its initial commitments and offered the following commitments:

1. Vifor will engage in a comprehensive, multi-channel communication campaign to remedy and undo the potential effects of its potentially misleading information campaign concerning the safety of Monofer. In particular, it will:
    
   • provide a succinct factual clarification via email, mail and in-person meetings to a significant number of healthcare professionals in the Member States where the Commission found Vifor to be dominant;
   • publish the clarification prominently on Vifor's website;
   • publish the clarification in leading medical journals in each of the Member States concerned; and
   • allow third parties including Pharmacosmos to use Vifor's clarification when contacting health professionals.
      
2. Vifor will refrain from engaging in external promotional and medical communications (whether written or oral) about Monofer's safety profile using information which is not based on Monofer's label or obtained from clinical trials specifically conducted to compare Ferinject and Monomer across the EEA.
    
3. Vifor will implement certain measures and safeguards to ensure compliance, including:
    
   • internal mechanisms to ensure that all relevant external promotional and medical communications as well as internal training materials comply with Vifor's commitments to the Commission prior to their use;
   • annual internal training of staff; and
   • a system of certification of compliance.

A monitoring trustee will monitor the implementation of the commitments for a period of 10 years.

The Commission concluded that Vifor's commitments would address its competition concerns over Vifor's potential disparagement of Monofer. It therefore decided to make them legally binding on Vifor.

If Vifor fails to comply with the commitments, the Commission may impose a fine of up to 10% of its total annual turnover without having to find an infringement of EU competition law, or a periodic penalty payment of 5% per day of its daily turnover for each day of non-compliance.

Significance of the decision

This is the first Commission decision relating to alleged disparagement of competing products, and demonstrates its commitment to eliminating such practices, particularly in sensitive sectors such as pharmaceuticals. In announcing the decision to accept the commitments, Margrethe Vestager, Executive Vice-President in charge of competition policy noted that "Iron deficiency is a condition affecting millions of people across Europe. Access to safe, effective, and affordable medicines is therefore essential" and that the decision "makes these commitments legally binding on Vifor and re-establishes a level playing field to the benefit of consumers".

A second Commission investigation, into Teva, relating to Copaxone, is ongoing. That relates to allegations of disparagement as well as artificially extending patent protection with a view to hindering market entry and uptake of a competing product.

Disparagement as an infringement of Article 102 TFEU has previously been sanctioned by the French Competition Authority ("FCA") in four cases, relating to Sanofi (Plavix), Schering-Plough (Subutex), Janssen-Cilag (Durogesic) and Novartis, Roche and Genentech (Avastin/Lucentis). The Paris Court of Appeal annulled the FCA’s decision on appeal, and appeal against this judgment is pending before the Court of Cassation. The Italian and Belgian national competition authorities have also found infringements based on the dissemination of misleading information in relation to Avastin and Lucentis. The concept that dissemination of misleading information to the regulatory authorities, healthcare professionals and the general public can raise concerns under the EU competition rules has also been upheld by the EU Court of Justice (Hoffmann-La Roche, 23 January 2018).

It should be noted that disparagement is not limited to the provision of objectively false information. A factual analysis in the specific context of a case will always be necessary but generally disparagement can also include any alarmist or misleading communication that can influence the behaviour of healthcare professionals, taking into account their risk aversion. It could include, for example, ambiguous messaging, incomplete or subjective presentation of scientific studies (or reliance on studies which have been superseded), and raising safety concerns of competing products without supporting evidence.

Caution is therefore required from companies, particularly in the pharmaceutical sector, when referring to competitor products in their communications with healthcare professionals or the public.