On February 25, 2013, the French Competition Authority (the “Authority”) decided on its own initiative to launch a sector inquiry into the functioning of competition in the pharmaceutical distribution sector.

The Authority effectively considers that the major economic and regulatory changes the pharmaceutical sector is currently undergoing could be an opportunity to “intensify competition in a sector where it is often sluggish”.

The sector inquiry will cover the entire distribution chain and will thus concern the three main players in the sector: pharmaceutical laboratories, wholesale distributors and retail pharmacies.

  1. As regards pharmaceutical laboratories, the Authority will focus in particular on the following two issues: (i) the pricing policy of laboratories, both for drugs that are not reimbursable by the Social Security system (for which prices are not regulated), and for drugs that are reimbursable (strictly regulated) and (ii) the development of generic drugs that may be hindered by certain practices followed by pharmaceutical laboratories.
  2. The Authority will then analyze the activity of wholesale distributors, specifically their dealings with laboratories and retail pharmacies, as well as the effects of the competitive pressure to which they are subject as importers or exporters of medicinal drugs within the European Union.
  3. As regards pharmacists, the Authority will focus on the distribution of drugs that are not reimbursable, in particular their sale in supermarkets, a debate that was recently re-launched by a major retail chain.

The Authority will also be looking into the issue of online sales of medicinal drugs. Such sales were recently authorized in France pursuant to an order dated December 19, 2012 transposing European Directive 2011/62/EU of June 8, 2011, but the order was suspended by decision of the French Council of State (Conseil d’Etat).

On February 14, 2013, the French Council of State had in fact held that serious doubt existed concerning the legality of the new Article L. 5125-34 of the Public Health Code under European Union law, in that it provides that only certain non-prescription drugs can be sold online (more commonly called over-the-counter drugs).

In an opinion dated December 13, 2013, the Authority had observed that this limitation might constitute an unjustified restriction in view of the provisions of the Directive of June 8, 2011.

In its press release, the Authority announced that its preliminary findings would be submitted for public consultation and that it would be publishing its final opinion by the end of the year.