Bloomberg | Aoife White
European Union antitrust regulators are investigating whether
pharmaceutical companies may thwart sales by traders who profit from
differences in drug prices between nations.
The EU has started a probe focusing on what is called parallel trade, in
which wholesalers buy medicines at state-regulated prices in countries such as
Spain or Greece and sell them in markets such as the United Kingdom, where
drugs are more expensive, said Blaz Visnar, an antitrust official at the
European Commission.
"We have sent the first round of questionnaires out," Visnar told
a conference in Brussels. He didn't name the companies that are being quizzed.
Officials may examine drugmakers' arguments that price discrimination could be
justified for lower prices of medicines intended to be used in poorer
countries, he said.
An EU investigation could provide guidance on drugmakers' efforts to block
parallel trade, which had sales of $5.6 billion in the EU in 2008, according to
the European Federation of Pharmaceutical Industries and Associations, a
Brussels trade group that represents manufacturers. GlaxoSmithKline was
prevented by antitrust regulators in 2001 from introducing higher prices in
Spain for drugs intended for export.
Regulators were told by an EU court in 2009 to re-examine Glaxo's arguments
for dual-pricing in Spain. The company had claimed that a two-tiered pricing
system would prevent it from losing revenue from parallel trade and help it
invest more in research and innovation. It never implemented the pricing
policy.
Huge price differences for the same drugs across the EU have spurred an
arbitrage trade for medicines. EurimPharm Arzneimittel GmbH, a German drug
trader, has annual sales of about $522 million from buying pharmaceutical
products in one European country and selling them in another at a higher price.