Competition Law

SpicyIP Tidbit: CCI Orders Investigation Against Pharma Major Roche


The Competition Commission of India, based on a positive prima facie determination on contravention of Section 4(2)(c) of the Competition Act, ordered investigation against pharma major Roche with respect to the cancer drug, Trastuzumab. The complaint was filed by Biocon and Mylan Pharmaceuticals.

I shall be carrying a detailed analysis shortly.

[Section 4. Abuse of Dominant position

(1) No enterprise or group shall abuse its dominant position.] (2) There shall be an abuse of dominant position 4 [under sub-section (1), if an enterprise or a group].—-

…………………………..

(c) indulges in practice or practices resulting in denial of market access 5 [in any manner]; or….]

Highlights of the Order

The Commission is of the considered opinion that biological drugs as well as its biosimilars form part of the same relevant product market. In the present case, the relevant product market, thus, would be the “market for biological drugs based on Trastuzumab, including its biosimilars”. (para 49)

The Commission observes that the right to bring civil litigation and other claims to assert or defend key interests is a legal right. Such right should not be interfered with, except when warranted by special circumstances. Mere fact that litigation was ultimately unsuccessful does not render it vexatious. However, in exceptional cases, the legal processes can be pursued by a dominant enterprise as a tactic to exhaust smaller rivals’ resources and delay or prevent their  entry  in the relevant market. Where anticompetitive litigation of this kind by a dominant enterprise is identified, it amounts to an abuse within the meaning of the Act. Though there cannot be any straightjacket formula for identifying such exceptional circumstances, there can be certain guiding factors which may help in examining a case. First, it needs to be established that the impugned legal action, on an objective view, is baseless and appears to be an instrument to harass the defendant/respondent; and, Second, the legal action appears to be conceived with an anti-competitive intent/plan to eliminate competition. (para 62)

Thus, the practices adopted by Roche Group to create an impression about the propriety of the approvals granted, the safety and efficacy of biosimilars, the risk associated and the outcome of the on-going court proceedings in the medical fraternity, including doctors, hospitals, tender authorities, institutes etc., when seen collectively, prima facie appear to be aimed at adversely affecting the penetration of biosimilars in the market. (para 74)

Even a partial denial of market access that takes away the freedom of a substitute to compete effectively and on merits in the relevant market, may amount to a contravention of Section 4(2)(c) of the Act. (Para 77)

Based on the foregoing analysis, the Commission is of the considered view that prima facie, the contravention with regard to Section 4(2)(c) of the Act is made out against Roche Group, which warrants detailed investigation into the matter. The DG is, thus, directed to carry out a detailed investigation into the matter, in terms of Section 26(1) of the Act, and submit a report to the Commission, within 60 days. (para 81)

For detailed analysis, see ‘CCI Order on Pharma Major Roche – I, II and III.

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Mathews P. George

Mathews P. George

Mathews is a graduate of National University of Juridical Sciences, Kolkata. His interest in intellectual property was kindled when he bagged the second position in his very second year in the prestigious Nani Palkhiwala Essay Competition on Intellectual Property. Winner of almost a dozen essay competitions in his law school days, he was involved in various research and policy initiatives relating to intellectual property. His stint as a student of Prof. Shamnad Basheer further accentuated his interest in intellectual property.

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