MADRID, 25 Oct. (EUROPA PRESS) -

The National Markets and Competition Commission (CNMC) has fined the pharmaceutical company Merck Sharp and Dohme (MSD) 38,934,000 euros for abuse of a dominant position in the market for contraceptive vaginal rings.

As explained by the CNMC in a statement, MSD enjoyed a monopoly from 2002 to 2018 by owning the patent for the first vaginal ring in Spain, the contraceptive 'Nuvaring'.

The competitor company Insud Pharma had developed an alternative vaginal ring to the one protected by the MSD patent and which began to be marketed in June 2017 under the name 'Ornibel'.

Invoking its patent right and alleging reasons of urgency, MSD requested the Mercantile Court number 5 of Barcelona to carry out a fact-checking procedure and, subsequently, an "inaudita parte" precautionary measure, that is, without hearing Insud Pharma, to paralyze the manufacture and sale of the 'Ornibel' ring in Spain.

The CNMC considers it proven that both when requesting the diligence to verify the facts and the subsequent precautionary measures, MSD "deployed a strategy of deception to the judicial body, hiding relevant factual and technical information from it."

"The lack of transparency in the information provided during this process was a determining factor in obtaining the requested precautionary measure, paralyzing the marketing and sale of the 'Ornibel' between September and December 2017," details the CNMC.

For this reason, the regulatory body believes "it has been proven that the objective of the legal actions undertaken was not to assert its patent rights, but rather that they were exercised within the framework of a plan whose purpose was to suppress the competition of the new entrant for as long as possible. ".

Insud Pharma was unable to restore the production of 'Ornibel' until in December 2017 the precautionary measures were lifted by means of a court order issued as a result of its opposition to them.

The CNMC alleges that since the only factory that produced its rings was located in Spain, the stoppage of manufacturing "affected distribution and sale in all the countries where it had begun to be marketed, so the conduct also affected competition in various countries of the European Union.

"This stoppage of production meant the extension of MSD's dominant position, altering the evolution of the vaginal ring market that would have occurred had the normal competitive dynamics been maintained," they add in this regard.

In the same way, the CNMC considers that the lack of transparency with which MSD acted is "contrary to competition based on merit", since every dominant company has a "special responsibility" consisting of "not preventing, with its behavior the development of effective and undistorted competition in the common market".

Consequently, the CNMC has sanctioned MSD with 38,934,000 euros for committing a very serious infringement, constituting abuse of a dominant position and typified in articles 2 of the Law for the Defense of Competition (LDC) and 102 of the Treaty of Functioning of the European Union (TFEU).

In addition to considering the Spanish subsidiary of MSD as the author of the sanctioned practices, the CNMC has declared its parent company, MSD Human Health Holding, jointly and severally liable for the purpose of paying the fine.

The CNMC has apostilled that a contentious-administrative appeal may be filed directly against this resolution before the National High Court within two months from the day following its notification.

This kind of behavior has long been in the crosshairs of the European authorities. In July 2009, the European Commission published its research report on the pharmaceutical sector, in which it analyzed the reasons for the delays in the arrival of generic drugs on the market.

The European Commission detected that some judicial actions apparently intended to protect patents were part of strategies to extend the extension and duration of the protection conferred by its patents, in order to block or hinder the entry of generics into the market. At the moment, the European Commission is carrying out proceedings for misuse of the patent system to avoid competition.