EU accuses pharma of blocking competition

As expected, the European Union socked it to pharma in a new industry-sector report, saying that drugmakers' business strategies have added billions to healthcare costs. By delaying or blocking the sale of cheaper generics, drug companies have tried to protect their own interests at the expense of patients and government, the report concluded.

You'll recall that the EU launched this antitrust probe with some high-profile visits to Big Pharma offices, including GlaxoSmithKline, Pfizer, and Sanofi-Aventis. Now, regulators won't name names, but they do say they are ready to act. Officials "will not hesitate to open antitrust cases against companies where there are indications that the antitrust rules may have been breached," investigation chief Neelie Kroes said.

Drugmakers' "anticompetitive" practices cost patients and healthcare systems an additional $3.8 billion from 2000 to 2007, Kroes told the New York Times. And she didn't reserve her criticism for brand-name companies; the EU's competition chief also assailed generics makers for taking $200 million in exchange for keeping their products off the market.

Officials even publicly quoted from documents they obtained from drugmakers, painting a picture of companies that actively seek to quash competition. "We identify options to obtain or acquire patents for the sole purpose of limiting the freedom of operation of our competitors," one document said. Pharma's European trade group took issue with that characterization, saying that officials had selectively quoted from the documents, giving a skewed picture of industry practice.

- read the story in the New York Times