Yesterday the Federal court handed down its decision in ACCC v Pfizer. The facts of the case reflect the very significant power of IP rights and the concerns that can arise for rights holders when IP rights expire. Pfizer’s internal forecasts were that sales of its Lipitor product in Australia would fall from $770m to $70m upon expiry of the relevant patents in 2012. Obviously faced with such a threat, IP rights holders will take significant steps to try to maintain their market position. In Pfizer’s case it substantially re-engineered its business by entering into the generic medicines market.
The Judge found that the significant steps Pfizer took ,while making it harder for other drug manufacturers to compete, did not amount to unlawful anti-competitive conduct.
From a legal perspective, the case reflects the significant tension between IP rights (which are inherently anticompetitive) and competition law which is intended to prevent entities misusing market power. This tension is one thing the Harper Review on competition policy is considering.