Bureau proactively monitors settlements between drug manufacturers to identify potentially illegal agreements
May 20, 2022 - GATINEAU, QC - Competition Bureau
The Competition Bureau announced today that it has closed two recent investigations into potentially anticompetitive patent litigation settlement agreements involving pharmaceutical drugs.
The investigations were launched as a result of the Bureau's proactive monitoring of agreements between branded and generic drug manufacturers. In Canada, companies are not required to notify the Bureau of agreements that settle cases involving patented medicines. To protect competition and innovation, the Bureau proactively monitors these cases using publicly available information. It then identifies legal proceedings that have been closed with the consent of the parties involved and gathers information to determine whether an agreement may contravene the Competition Act.
The Bureau's Intellectual Property Enforcement Guidelines (IPEGs) identify that patent litigation settlement agreements between drug manufacturers may be anticompetitive, such as when payments (whether monetary or non-monetary) are made to delay the entry of generic drugs into the market.
Evidence gathered during these recent investigations suggested that the agreements under review did not contravene the Act. Nonetheless, the Bureau recognizes that these types of agreements have the potential to result in significant anticompetitive and economic harm - hence the importance of its proactive enforcement efforts.
A complete position statement summarizing the Bureau's general approach to reviewing these types of agreements, and areas of concern is available on its website.
Promoting and protecting competition in the Canadian health care sector is a priority for the Competition Bureau. The Bureau continues to actively monitor patent litigation proceedings and will take appropriate enforcement or advocacy action in the future, if warranted.
