Anticompetitive unilateral conduct

Abuse of dominance

In what circumstances is conduct considered to be anticompetitive if carried out by a firm with monopoly or market power?

Any conduct aimed at limiting access to the market or competition is likely to be considered abusive if it is carried out by an undertaking holding a dominant position (article L420-2 of the CC).

Abusive behaviour by a dominant firm may consist of a refusal to sell, tying, discriminatory conditions of selling and breach of commercial relationships, or denigration of generic medicinal products.

For example, in Decision No. 03-D-35, the FCA imposed a €7.8 million fine on Sandoz for abuse of dominant position by offering tied discounts. The firm proposed the hospitals discounts on its global sales to hospitals (especially sales of medicines that were deemed to be in a dominant position) on the condition that the hospitals undertook to buy other products for which the firm was competing with other pharmaceutical firms. The FCA considered that such a scheme resulted in increasing customer loyalty towards Sandoz.

The FCA fined both Sanofi-Aventis (in Decision No. 13-D-11) and Schering-Plough (in Decision No. 13-D-21), for abusing their dominant position, notably by denigrating generic medicinal products. The FCA ruled that such practices had the object and effect of restricting the generic companies’ access to market. The Supreme Court confirmed the two decisions from the FCA.

On 8 July 2014, the FCA fined Cegedim, one of the medical database firms’ leaders, €5.7 million for having refused to sell its database to pharmaceutical companies that were using another firm’s software while such database was regarded by healthcare professionals as being the ultimate system. This analysis was confirmed by the Supreme Court on 21 June 2017.

De minimis thresholds

Is there any de minimis threshold for a conduct to be found abusive?

In accordance with the provisions of the TFEU and the case law of the EU, restrictions that affect the market only insignificantly, given the low position of the undertakings, do not fall within the prohibition laid down in paragraph 1 of article 101 of the TFEU (anticompetitive agreements). Although not legally binding, the EC’s Notice on agreements of minor importance (de minimis) defines thresholds below which the competition infringement is deemed insignificant.

This ‘soft law’ text may serve as a helpful analytical guide for national competition authorities, each of which may have its own prosecution policy.

In French law, article L464-6-1 of the CC gives the FCA the power to dismiss the case when a threshold of 10 per cent (for agreement between competing companies) or 15 per cent (for agreement between non-competing companies) is not exceeded, except for gross restrictions (article L464-6-2 of the CC).

Should the thresholds not be met, the practice may still be considered anticompetitive because of its sensitive nature (eg, Decision No. 13-D-14 sanctioning two professional organisations of veterinarians for having set up a charter defining the prices that the signatory veterinarians had to charge).

Market definition

Do antitrust authorities approach market definition in the context of unilateral conduct in the same way as in mergers? If not, what are the main differences and what justifies them?

The authorities may use similar criteria to define the targeted market, such as the ownership of property rights, the ATC classification, the patients’ propensity to switch treatments or the drug price factor as regards merger control and dominant position. Apart from these criteria, which are sector-specific, both approaches are very different in essence. While merger control focuses upstream on a prospective analysis of whether the transaction would significantly impede effective competition in particular by creating or strengthening a dominant position in France or within the EU, the authorities’ approach on anticompetitive unilateral conduct is based, downstream, on a concrete and actual analysis where the enterprise under scrutiny should be in a dominant position.

Establishing dominance

When is a party likely to be considered dominant or jointly dominant? Can a patent owner be dominant simply on account of the patent that it owns?

A dominant position can be defined as the situation where an undertaking has the faculty to behave independently of its competitors, customers, and ultimately from consumers (ECJ, United Brands, C-27/76). In practice, a large market scale often entails a dominant position though other indicators can be used (eg, weakness of competition, absence of competition, control of resources and technology).

The FCA follows the EU case law in its assessment of these situations. However, although it left the question open, the FCA surprisingly seemed to consider that, despite important market shares of 55-60 per cent in 2000 and 70-75 per cent in 2004, Sanofi-Aventis may not have held a dominant position in the hospital medicines market (see Decision No. 10-D-02 dated 14 January 2010).

Regarding joint domination, the FCA assesses factors connecting the undertakings that give them the power to adopt a common market policy, applying the EU case law as such (Judgment of 7 October 1999, T-228/97, Irish Sugar). To date, the FCA has never found a joint domination in the pharmaceutical sector (ie, Decision No. 07-D-42, Nestlé, Danone-Blédina, Milupa-Nutricia, Sodilac, Decision No. 09-D-38).

IP rights

To what extent can an application for the grant or enforcement of a patent or any other IP right (SPC, etc) expose the patent owner to liability for an antitrust violation?

In 2001, the FCA ruled that the mere application for the grant of a patent was not abusive, since such conduct would not be capable of harming competition (see Decision No. 01-D-57).

However, in the AstraZeneca case, the General Court, followed by the ECJ, upheld the Commission’s decision that ruled that the mere application for a supplementary protection certificate could amount to an abuse (ie, Judgment dated 1 July 2010, Case T-321/05, Decision dated 6 December 2012, Case C-457/10P). In its 2009 report on the pharmaceutical sector, the EC also criticised the ‘patent filing strategies’ and the use of ‘patent clusters’ to delay or block the market entry of generic medicines as well as some defence strategies used by originator companies in courts.

This being said, abuse of court proceedings remains exceptional in the EU (see Case T-111/96 ITT Promedia NV ) and in France (see Decision No. 01-D-57).

When would life-cycle management strategies expose a patent owner to antitrust liability?

Life-cycle management strategies may expose a patent owner to antitrust liability. This is true in the case of strategies by originator companies that consist of the launch of second-generation products or the follow-on of medicinal products shortly before the loss of exclusivity of the first-generation product, sometimes combined with the withdrawal of the initial product from the market and withdrawal of the MA. AstraZeneca was fined €60 million for having implemented such practices with its medicine Losec (see question 33).

Although the manufacturer has the right to withdraw its MA ‘at any point in time without being obliged to give any reasons’ (C-94/98, Rhone Poulenc Rorer), a company in a dominant position holds a ‘particular’ responsibility and is also expected to exercise its right in a reasonable way in respect of third parties’ access to the market (see CFI T-24/93, Compagnie maritime Belge Transport SA).

To date, the FCA has not had the occasion to rule on the conformity of such practices with competition law.


Can communications or recommendations aimed at the public, HCPs or health authorities trigger antitrust liability?

Yes, see question 27.

Authorised generics

Can a patent owner market or license its drug as an authorised generic, or allow a third party to do so, before the expiry of the patent protection on the drug concerned, to gain a head start on the competition?

Launching its own generic or granting a licence to do so shortly before the expiry of the patent protection with the intention to allow an ‘early entry’ has been a common practice of originator companies for many years.

In principle, such practices are not seen as anticompetitive per se. Such a statement would only be justified after an in-depth analysis of each contractual provision and of the possible effects on competition and consumers. To date, there has been no case law in France regarding this practice of authorised generics. In this regard, in its report on authorised generics, the FCA noticed that such early entry could have a positive impact on consumers and the healthcare system.

In this sort of context, the originator firm should be able to demonstrate that the practice does not have any anticompetitive effects by preparing and implementing a competitive balance providing empirical evidence that the ‘effect’ and ‘competitive balance’ arrangement would be positive, the latter improving distribution of medicines within the relevant territory, while allowing consumers a fair part of the resulting benefit, without evicting competition for a substantial part of the medicines concerned.

Restrictions on off-label use

Can actions taken by a patent owner to limit off-label use trigger antitrust liability?

In a recent decision (23 January 2018, F Hoffmann-La Roche and Others, C-179/16), the ECJ ruled that the agreement between Roche and Novartis, who marketed similar medicines, is anticompetitive by object. Both pharmaceutical companies had put in place an arrangement intended to disseminate information that questioned the safety of one of these products to prevent the off-label use of such product and therefore reduce competition.


When does pricing conduct raise antitrust risks? Can high prices be abusive?

The FCA plays a great role in the field of exclusionary abuses (ie, presence of barriers to the market that exclude competitors) where the market structure pulls prices up and the aim is to remove barriers to entry.

However, pricing abuse refers more to an abuse of dominant position (ie, absence of sufficient competition within sectors particularly at risk, such as the pharmaceutical sector). The usual approach is based on costs, value of service and comparison with other prices (see, for example, ECJ, 14 February 1978, United Brands, C-27/76).

However, the ECJ recently confirmed that there is no single method to achieve such qualification and that the national competition authorities have ‘a certain margin of manoeuvre with respect to the methodology that may be followed to determine an excessive price’ (Opinion of the Advocate General Wahl, 6 April 2017, AKKA/LAA, C-177/16).

For the very first time, the EC opened an investigation on excessive pricing against Aspen in May 2017 (see question 40).

Sector-specific issues

To what extent can the specific features of the pharmaceutical sector provide an objective justification for conduct that would otherwise infringe antitrust rules?

Public health issues may be taken into account. In Decision No. 07-D-22, the FCA admitted that quota systems adopted by some originator companies had the legitimate aim of rationalising production and optimising medicine distribution with regard to the country’s needs, even if sector specificities have not been deemed sufficient to be considered as an objective justification. The FCA considered that these restrictions were limited to what was strictly necessary for a reliable and optimal supply of the French market, while maintaining real competition possibilities between wholesale distributors.

However, French decision practice could evolve based on more recent European case law. Thus, in the Spanish GSK case (ECJ, October 2009, GlaxoSmithKline Services Unlimited, C-501/06, C-213/06, C-515/06 and C-519/06), when examining the dual pricing schemes, the ECJ confirmed that the specific legal and economic context of the pharmaceutical sector could be relevant in the application of article 101(3) of the TFEU.