Out-Law News 3 min. read

Drugs used 'off-label' can be rivals to authorised drugs for competition law purposes, says EU court

Drugs prescribed to treat conditions they weren't authorised for can be in direct competition with medicines specifically authorised for that condition, the EU's highest court has ruled.

The Court of Justice of the EU (CJEU) said EU law does not prohibit "the off-label prescription of a medicinal product nor its repackaging for such use", but that certain conditions must be met for such use or repackaging to be compliant with EU regulations.

'Off-label' use of drugs refers to the prescription of medicines by doctors for different treatments than those they were originally intended for. 

The CJEU was considering whether drugs used on an off-label basis for a condition can be said to be competing in the same market as medicines designated for treating that condition.

Defining the scope of markets is an important part of the EU's competition law regime, as it is in particular markets that the actions of businesses are assessed for compliance with competition rules.

The CJEU was asked by a court in Italy to examine whether drugs giants Roche and Novartis breached competition laws by seeking to influence demand for two drugs used to treat the eye disease 'wet age-related macular degeneration' (AMD).

Novartis is authorised to market Lucentis, a drug developed to help treat AMD, in the EU. Roche is authorised to market Avastin for the treatment of cancer in the EU. Novartis owns one-third of the shares of Roche. Both companies have the right to exploit the rights in the products under licensing agreements with Genentech, a subsidiary of Roche.

Some medical practitioners have found that patients with both cancer and AMD saw improvements to their health in respect of their AMD after being administered with Avastin. This development, coupled with the fact that the Novartis product is more expensive, led doctors around the world to prescribe Avastin for treating AMD on an 'off label' basis and meant Avastin became the main rival drug to Lucentis in the market.

Roche and Novartis have been accused of disseminating misleading information about the risks posed from the intravitreal use of Avastin for treating AMD. Intravitreal use concerns injection of the drug into the eye. In 2014, Italy's competition watchdog, the Autorità Garante della Concorrenza e del Mercato (AGCM), fined the companies a total of approximately €180 million in relation to the alleged activity which the regulator said was designed to influence demand in favour of Lucentis over Avastin and thus maximise profits.

In assessing the case, the CJEU considered whether Avastin and Lucentis could be said to be in competition with one another in the same market.

The court also looked at whether practices intended to emphasise that a medicinal product is less safe or less effective can be regarded as a restriction of competition 'by object', and therefore a breach of EU competition law.

In assessing whether the products are rivals in the same market, the CJEU considered the "interchangeability or substitutability" of Avastin for Lucentis. Under existing EU case law, "the relevant product market comprises all those products and/or services which are regarded as interchangeable or substitutable by the consumer, by reason of their characteristics, their prices and their intended use", the CJEU said.

Case law requires interchangeability or substitutability to be assessed more broadly than purely on the basis of "the objective characteristics of the products and services at issue", the court said. In addition, "the competitive conditions and the structure of supply and demand on the market must also be taken into consideration", it said.

In the pharmaceuticals market, products that are sold illegally cannot, "in principle", be considered as "substitutable or interchangeable products" for those marketed legally, the CJEU said. However, medicines do not need to be specifically authorised for treating particular diseases to be considered as rivals to products formally licensed for such purposes to be considered as active in the same market, it said.

Drugs that have received marketing authorisation (MA) can be used "for therapeutic indications not covered by their MA" in some circumstances, the CJEU said. Their use is permitted in "situations in which the doctor considers that the state of health of his individual patients requires that a medicinal product be administered for which there is no authorised equivalent on the national market or which is unavailable on that market", it said.

The court also provided guidance on whether drugs companies that coordinate to spread misleading information regarding the risks of medicines can be considered to be breaching EU competition laws.

"An arrangement put in place between two undertakings marketing two competing products, which concerns the dissemination, in a context of scientific uncertainty, to the EMA (European Medicines Agency), healthcare professionals and the general public of misleading information relating to adverse reactions resulting from the use of one of those products for the treatment of diseases not covered by the MA for that product, with a view to reducing the competitive pressure resulting from such use on the use of the other medicinal product, constitutes a restriction of competition ‘by object’ for the purposes of that provision," the CJEU said.

The Council of State in Italy will now consider the CJEU's ruling and interpretation of the legal questions put to it to determine the outcome of the appeal Roche and Novartis have lodged in the country against the fines imposed by the AGCM.

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