Anticompetitive agreements

Assessment framework

What is the general framework for assessing whether an agreement or concerted practice can be considered anticompetitive?

The general framework is set out in the GWB. Section 1 of the GWB provides for a prohibition of the same type of anticompetitive as article 101 of the TFEU. It prohibits agreements and concerted practices that are not exempted under section 2 of the GWB or the block exemption regulations as in force under EU law to which section 2 of the GWB explicitly refers. The GWB contains a dynamic referral to the block exemption regulations in order to ensure that national German law does not prohibit any agreements or concerted practices that would be lawful under EU law. Furthermore, the FCO and German courts apply articles 101 and 102 of the TFEU when dealing with antitrust cases that may affect trade between two or more EU member states.

Technology licensing agreements

To what extent are technology licensing agreements considered anticompetitive?

Technology licensing agreements are generally considered to be pro-competitive. The principles that are relevant under EU law also apply in a German context. This is true in particular for the application of Regulation No. 316/2014 on the application of article 101(3) of the TFEU to categories of technology transfer agreements and its corresponding guidelines. Research and development agreements and specialisation agreements are covered by specific exemptions under, respectively, Regulations Nos. 1217/2010 and 1218/2010.

Co-promotion and co-marketing agreements

To what extent are co-promotion and co-marketing agreements considered anticompetitive?

The principles that are relevant under EU law also apply in a German context. Co-promotion and co-marketing agreements fall within the wider category of commercialisation agreements. These types of agreements are very common in the pharmaceutical sector and are generally considered to be pro-competitive. However, co-promotion and co-marketing agreements may lead to restrictions of competition if they give rise to an anticompetitive exchange of commercially sensitive information between actual or potential competitors, if their true aim is to delay market entry of a competing drug or if they result in an elimination of potential competition.

Other agreements

What other forms of agreement with a competitor are likely to be an issue? How can these issues be resolved?

Any cooperation or communication with an actual or potential competitor involving an exchange of commercially sensitive information may be found to artificially increase transparency in the market or facilitate collusion. The focus is on confidential information that can be considered strategic, including prices (pricing policy, price increases, rebates), contractual conditions (eg, payment conditions, guarantee conditions), market position (eg, turnover figures, market shares, customers), production (eg, capacity, utilisation, costs) and commercial policy (eg, future plans, investments, innovations). Information relating to future prices and quantities is considered to be particularly sensitive. To mitigate the risk, undertakings should ensure that a minimum amount of information is exchanged, and that the exchange of information is justified by a legitimate commercial reason.

Issues with vertical agreements

Which aspects of vertical agreements are most likely to raise antitrust concerns?

Vertical restrictions relating to price as well as customer and territorial restrictions are of particular relevance in the pharmaceutical sector. In 2008, the FCO imposed a fine of €10.34 million on Bayer Vital GmbH, a distribution company of the Bayer Group, for influencing the resale prices of pharmacies for OTC products in an anticompetitive manner (the pharmacies had to follow price-recommendations to benefit from an additional discount on Bayer products).

Patent dispute settlements

To what extent can the settlement of a patent dispute expose the parties concerned to liability for an antitrust violation?

Parties to a patent dispute settlement risk infringing competition law if the settlement goes beyond the specific scope of the protective right (eg, the material or territorial scope or with respect to its duration).

The BGH held (Judgment of 5 July 2005, X ZR 14/03) that a settlement providing for the payment of licence fees for patent-free countries was void, as the parties to the settlement were not in dispute as to whether sales to patent free countries constituted a patent infringement. The case law of the European courts (eg, General Court, T-705/14 et al, on the anticompetitive nature of settlement agreements between Servier and several generic companies) is also relevant in a German context.

Joint communications and lobbying

To what extent can joint communications or lobbying actions be anticompetitive?

Joint communications of undertakings, in particular within the framework of trade associations, for example, in the form of recommendations, statements, oral statements in meetings, press releases or calls for boycott, constitute a competition law infringement if they are used as a vehicle for undertakings to coordinate their market behaviour. Illicit behaviour includes price recommendations, recommendations to pass on increases of raw material prices or unjustified calls for boycott. With respect to lobbying actions, undertakings must ensure, as with any contact with a competitor, that these are not misused as a vehicle for anticompetitive behaviour, such as exchange of sensitive information or data.

Public communications

To what extent may public communications constitute an infringement?

Public communications are usually not considered to be anticompetitive. However, for example, the public announcement of a price increase can constitute an infringement if it is in fact the final element of an agreement on pricing with a competitor, or if such a price increase is made public with an unnecessary amount of detail and long enough in advance to see whether competitors react by increasing their prices as well.

Exchange of information

Are anticompetitive exchanges of information more likely to occur in the pharmaceutical sector given the increased transparency imposed by measures such as disclosure of relationships with HCPs, clinical trials, etc?

Initiatives to ensure transparency, in particular with respect to relationships with and payments or services granted to HCPs, have increased in the past years. The increased transparency requirements imposed on the pharmaceutical industry could lead to increased risks of collusion and information exchanges. However, transparency rules usually provide for exceptions in the case of commercially sensitive information and compliance with transparency rules should not be considered as an antitrust infringement. For example, Regulation No. 536/2014 on clinical trials (application scheduled for 2020), which provides for reinforced transparency obligations with regard to clinical trial data via their publication on an EU database, allows limitations to disclosure to protect confidential information. Similarly, the European Federation of Pharmaceutical Industries and Associations (EFPIA) Disclosure Code, which requires all EFPIA members to disclose transfer of value to HCPs and healthcare organisations, allows aggregate disclosure when individual disclosure is not legally permitted.