EU warns of new antitrust probes for drug makers

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Story Published: Sep 29, 2009 at 10:24 AM MDT

Story Updated: Sep 29, 2009 at 10:24 AM MDT

BRUSSELS (AP) — The European Union's top antitrust official warned drug makers Tuesday to "look out" for new investigations in coming months.

EU Competition Commissioner Neelie Kroes said regulators were capitalizing on a recent broad inquiry into the pharmaceutical sector that aimed to find out why generic versions of branded drugs were slow to come to the market and if innovation is held back.

Drug makers say the European Commission is wrong to claim that industry practices slow the rollout of generic drugs after exclusive patents have expired.

EU regulators said they would monitor deals between major and generic drug makers that could delay the sale of these drugs.

So far, the EU executive has only launched one case on the back of its pharmaceutical report, investigating whether France's Les Laboratoires Servier struck deals with generic drug makers to hinder the launch of generic versions of its heart disease drug perindopril.

The EU says generic drugs are on average 40 percent cheaper than their branded rivals two years after they launch and play a key role in driving down health costs for Europe's aging and ailing population.

Speaking to the European Parliament's economy committee, Kroes defended a slew of EU antitrust fines.

"Firms also suffer from the higher costs if their suppliers form a cartel," she said. "Some fines are large — but they are always related to a company's turnover."

Cartel fines hit €2.27 billion ($3.33 billion) last year and the EU has already levied €1.27 billion this year.

Kroes said regulators calculate that cartels cause consumers and suppliers to pay at least €7.6 billion extra — or an overcharge of 10 percent for their products.

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