On 2 December a long-awaited ruling was published, in which the Lazio Regional Administrative Court (“TAR”) decided – dismissing it – on the action brought by Novartis and Roche against the sanction of a 180 million euro fine imposed upon them by the Italian antitrust authority (“AGCM”) for anti-competitive practices in relation to the respective drugs named “Lucentis” and “Avastin”.
As is known, the issue arises from the fact that Lucentis and Avastin can both be used to treat certain ocular pathologies. However, this treatment has only been expressly authorised by the regulatory authorities for the Lucentis drug by Novartis, while the same use of the Avastin medicine by Roche amounts to “off-label” use. In this context, by decision of 27 February 2014, the AGCM considered that the two companies had put in place anti-competitive practices contrary to article 101 (c) TFEU aimed at creating an “artificial distinction” between the drugs Avastin and Lucentis, “manipulating the perception of the risks of the use of Avastin in ophthalmology”. In particular, the differentiation of the two products would have occurred “by emphasising the safety profiles for the (off-label) intravitreal use of Avastin through the production and dissemination of information aimed at influencing the choices of doctors responsible for the therapeutic decisions and the choice of the related drugs”.
According to the AGCM, therefore, “in the presence of two drugs which are equivalent in every respect in the ophthalmic field, the two companies artificially differentiated the products, devaluing the contrary scientific knowledge, in order to promote the most expensive product (Lucentis, initially equal to 1,100 euro per injection and which then dropped to 902 euro in November 2012), from the sales of which profits derive for both companies, and prevent, or at least limit, the use of the less expensive (Avastin, amounting to 81.64 euro per injection)”. In this way, the agreement would have allowed “the maximisation of profits of all businesses, because of the complex business relationship between the groups Roche and Novartis”. Hence the imposition of sanctions on the two pharmaceutical groups, for about 90 million euro each.
Novartis and Roche then appealed against the AGCM decision, noting in particular (among other complaints):
- “that the progressive restrictions on the off-label use of Avastin are the result of a specific decision by the Italian Regulatory Authority (“AIFA”), and that Avastin and Lucentis are different medications (as regards active ingredient, therapeutic indications, dosage and administration routes). Therefore, the progressive restrictions on the off-label use of Avastin would have nothing to do with the alleged agreement, being simply the result of legitimate decisions of the competent authorities”;
- “that the scientific-technical evaluations made by AIFA and the EMA would have shown that Avastin and Lucentis cannot be considered equivalent for the purposes of ophthalmologic therapies, in contrast with the position taken by the AGCM without having the necessary scientific skills”;
- that “the systematic off-label use of a pharmaceutical product is unlawful in principle, the more so in relation to diseases treatable with drugs specifically approved for the same therapeutic indications”, therefore Novartis and Roche “could not legally market, promote or otherwise support the sales of Avastin in the ophthalmologic field placing it in competition against Lucentis”.
In its decision here under review, the TAR starts by saying that the scientific analysis of the drugs in question is outside its competence, given that such analysis “is reserved for other authorities (primarily the European Medicines Agency and the AIFA) the activities of which remain entirely extraneous and not relevant for the purposes of this case”. In fact, the Court does not take a stand on the pharmaceutical companies’ defence that restrictions on the off-label use of Avastin were due to AIFA and EMA, and not to an agreement between the two companies.
The TAR therefore simply detects the existence, in medical practice, of the off-label use of Avastin to treat certain eye diseases also treated with Lucentis, and thus concludes for “the substitutability of Avastin to Lucentis in the treatment of the same eye conditions, and therefore the reasonableness of the AGCM’s assessment that, in line with the general principles established in the field of competition, for the purposes of the definition of the relevant market, Avastin and Lucentis represent competing products”.
The Court then proceeded to check the documentation according to which the AGCM had concluded that the aforementioned anti-competitive agreement existed between Novartis and Roche: the decision in question refers specifically to an email between the parties in which they allegedly talk of a “differentiation” between the two products, and to other communications that would show that Novartis was involved in Roche’s internal decisions relating to the regulatory approvals required for Avastin.
Following a brief examination of such evidence, the Court concluded that “the contested decision is based on objective evidential documents that attest to the repeated contact between the two competitors, aimed at defining a common strategy for preventing the spread of the ophthalmic use of Avastin, and initiatives of repeated implementation of this strategy, in the places and contexts in which it was possible to act in order to generate the idea that Avastin was a more dangerous drug than Lucentis as it lacked a marketing authorisation for ophthalmic use”.
The TAR therefore confirmed the sanction imposed by the AGCM, though with a motivation that cannot really be praised for completeness and consistency. Indeed, Novartis and Roche have already declared their intention to further appeal the decision before the Council of State.