The EC J confirmed that the dual pricing policy implemented by GlaxoSmithKline (“Glaxo”) in Spain could potentially be exempted from competition rules. Glaxo sells medicines to Spanish wholesalers at different prices depending on the applicable national sickness insurance scheme. In practice, prices charged to wholesalers that export medicines are higher than those charged to wholesalers that resell medicines to Spanish pharmacies and hospitals. This dual pricing system is intended to prevent wholesalers from buying cheap medicines in Spain and reselling them at higher prices in other EU Member States. Several other pharmaceutical companies have adopted similar dual pricing systems.
In 2001, the EC decided that this policy violated competition law. On appeal the CFI annulled the EC ’s decision. According to the Court, Glaxo provided evidence showing that dual pricing generated additional revenues required to finance Glaxo’s R&D efforts. The CFI ruled that the EC should have examined this evidence and determined whether Glaxo’s dual pricing could be exempted as an agreement promoting technical progress. The EC J confirmed this ruling and ordered the EC to reconsider Glaxo’s pricing policy.