EU court gives mixed ruling on GlaxoSmithKline parallel trading case

The European Court of Justice rendered a mixed ruling on Tuesday in a lawsuit brought against GlaxoSmithKline by Greek wholesalers who claim the drugmaker tried to restrict drug sales in an effort to prevent wholesalers from reselling its medications in more profitable countries.

While the court ruled that GlaxoSmithKline would be in breach of EU antitrust laws if it refused "ordinary orders by wholesalers'' to prevent parallel sales, it referred the case back to Greece to determine whether the wholesalers placed unusually large orders for the company's products. The European Court decided that a pharmaceutical company would be "abusing its dominant position if it refuses to meet ordinary orders by wholesalers in order to prevent parallel exports. Whether orders are ordinary must be ascertained in the light of the needs of the national market in question and previous trading relations." The judgement further explained that a drugmaker is allowed to "counter in a reasonable and proportionate way the threat to its own commercial interests.''

Commenting on the news, Richard Freudenberg, president of the European Association of Euro-Pharmaceutical Companies, said that "the ruling makes it clear that efforts by manufacturers to stamp out their competitors by abusing their dominant position are illegal." However, EFPIA president Arthur Higgins stated that the laws "should protect consumers and patients rather than parallel traders."

The lawsuit dates back to 2000, when Greek wholesalers sued GlaxoSmithKline after the company refused to supply them with Lamictal, Imigran and Serevent, and curbed shipment volumes to allow only enough medicine for the Greek market.

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